Farm Succession Planning: How One Family Preserved $2.7m And Kept The Farm On Track
- Future Accounting
- Nov 13
- 9 min read
Updated: Nov 17
Written by: Chris Mulcahy
How smart farm succession planning helped one family save $2.7 million
“Sh#@, that’s amazing. I didn’t even know you could do that, what an outcome.”
Happy Farming Family, NSW, after three weeks working with Future Accounting
The farm succession planning problem no one wants to look at
If you’re a farming family thinking about farm succession planning, this probably sounds familiar:
Some of the land is in Mum and Dad’s personal names (or Nana/Pa as well).
Some of it was bought before 1985, most of it after 1985.
Some land changed hands between generations due to death, changing the tax cost base, but no one has these records.
You’ve heard scary words like capital gains tax, stamp duty, inheritance tax, possible CGT changes.
Every time someone says “We really should sort out the succession plan”, it ends in an argument, a headache, or both.
So you park it. Another year goes by.
Land values go up. The tax challenge gets bigger. The family tension builds quietly in the background.
And when anyone pushes too hard, the standard line comes out:
“Don’t worry, it’s all in our will. That’ll take care of it.”
Here’s the uncomfortable truth:
A will is not a farm succession planning strategy. It provides opportunity for estate challenges and getting ripped if/when the death duties is introduced.
A will decides who gets what when you die.
A farm succession plan decides:
Who controls what, and when
How the business keeps operating
How the tax, risk and family dynamics are managed over years – not just one day in a lawyer’s office
This particular family had wills. No one new what was in the wills – you can’t ask that, it’s personal! What they didn’t have was a workable farm succession plan.
A real farm succession planning case: 7,600 acres and an $8m tax issue
This family owns 7,600 acres.
On the surface, they were doing well: strong landholding, good operation, next generation keen to be involved.
Under the surface, there were landmines everywhere:
Around 50% of the land was in personal names – Mum, Dad and Nana.
A chunk was pre-85, but the majority was post-85 and fully exposed to CGT.
The unrealised capital gain was estimated at over $8 million.
On rough numbers, that meant a potential capital gains tax bill north of $2 million.
A traditional restructure and land transfer would likely trigger around $700,000 in stamp duty on top.
They were stuck. They knew they had to do something, but every professional they’d spoken to had basically said:
“Yeah, it’s expensive, that’s just how it is. I’ll be dead, they can deal with it then”
No clear plan. No pathway. Lots of fear.
Previous family discussions about “who gets what” had ended in fights, hurt feelings and silence.
This is exactly the sort of situation where smart farm succession planning can make a huge difference.
Family politics that make farm succession planning harder
It wasn’t just about tax.
Like most farming families, there was another layer no one really wanted to talk about:
One child on the farm full-time, carrying the load
Off-farm siblings who still wanted things to be “fair”
Mum and Dad in the middle, trying to please everyone and not blow up Christmas
They weren’t just scared of a $2m tax bill.
They were scared of making a decision that left one child feeling ripped off and another child feeling taken for granted – and dealing with the sulks, the silent treatment and the “you’ve always favoured them” comments for the next 20 years.
So “It’s all in the will” had become a way of avoiding the real farm succession planning conversations, not solving them.
Underneath all the spreadsheets and titles, that’s the real stress for a lot of farming parents.
Why we didn’t start with who gets which paddock
When they first came to us, they said the same thing we hear all the time about farm succession planning:
“We need a succession plan. Can you help us decide who gets what?”
Most advisers launch straight into splitting up the land. That’s how you end up with:
One kid getting the “good” block, one getting the “other” block
No one really understanding the tax or structure
A plan that works on paper, but falls apart in real life
We did the opposite.
We hit pause on the “who gets what” and went right back to the foundations:
What do you own? – every title, every entity
Who owns it? – personal, company, trust, partnership
How is it taxed now? – pre-85 vs post-85, cost bases, concessions available
What’s the risk if someone dies, divorces, or rules change?
Only once the foundations were clear did we move to:
“What’s the smartest way to get this land into the right structures for the next generation – without blowing it up in tax and duty?”
This is where you see the difference between:
“We’ve got a will.”
VS
“We’ve got a farm succession plan backed by the right structures, tax settings and family agreements.”
Using the rules properly in farm succession planning
Here’s where most families miss out.
The tax system is not designed to destroy every family farm. There are powerful concessions sitting there – but:
You have to qualify for them
You have to sequence things correctly
You have to prove your position if the ATO or State Revenue ask
Take action before theses very generous concessions no longer are available!
For this family, the turning point in their farm succession planning journey was understanding how the rules could work for them, not against them.
We focused on:
CGT small business concessions where available
Rollovers and restructuring options
Stamp duty concessions specific to primary producers and family restructures
Getting land out of personal names and into a discretionary / family trust structure
Positioning them ahead of any potential inheritance tax or tightening of CGT/income tax concessions in future
This isn’t “fancy tricks” or dodgy schemes.
It’s simply knowing the rules deeply enough to navigate them properly as part of farm succession planning.
The outcome: $2.7m preserved and a clear plan
By restructuring correctly and using the available concessions, we:
Avoided a large chunk of the potential CGT and stamp duty hit
Preserved at least $2.7 million in equity that would otherwise have been at serious risk over time
Moved land into a far more flexible, protective structure (discretionary / family trust) instead of leaving it exposed in personal names
Just as important as the numbers:
The family now has a clear roadmap for farm succession, not just random ideas
Conversations have shifted from “This is all too hard” to
“Okay, now we can see how this works for all of us”
Future planning (wills, control, management, buy-outs, off-farm kids) now sits on a solid structural and tax foundation
One of the family members literally said:
“We thought we were going to just have to cop it and lose a couple of million. Now I’m thinking… why the hell didn’t we do this five years ago?”
That’s the power of getting farm succession planning right, and getting it started early.
Is this farm succession planning result too good to be true?
If you’re thinking, “This sounds too good to be true”, here’s the honest bit:
This doesn’t work for everyone, but it will for most
You can’t just wave a wand and make tax disappear
The rules are complex and they change
You need proper numbers, proper advice and proper documentation
Most accountants don’t know how to utilise the concessions and structure a plan
But here’s the bigger truth:
Doing nothing is usually the most expensive option
Land left in personal names with no plan is a time bomb – tax, risk, family conflict
And no matter how good your lawyer is, your will alone will not fix a bad structure or a non-existent farm succession plan
That’s where good farm succession planning comes in.
Who this farm succession planning approach is for
What we did for this family is especially relevant if:
You’re a farming family in South Australia, Victoria or New South Wales
You hold significant land in personal names (Mum, Dad, grandparents)
You’ve got a mix of pre-85 and post-85 land
You’re worried about capital gains tax, stamp duty, inheritance tax and constant talk of changing concessions
You’ve tried to talk about succession before and it ended in fights or “let’s just leave it”
Your current plan is basically: “It’s in the will, they’ll sort it out when we’re gone.”
If you’re nodding along to that list, you’re exactly the type of family we built this farm succession planning process for.
What happens when you book a farm succession planning review with us
No fluff, here’s what we actually do:
Baseline review
We map out what you own, who owns it, and the tax profile of your landholding.
Risk and opportunity scan
We identify where you’re most exposed and where the concessions and restructure options may sit as part of your farm succession planning.
Strategy, not theory
We design practical steps – in what order, over what timeframe – to get you from “messy and exposed” to “structured and future-ready”.
Succession on solid ground
Only after the structure and tax foundations are right do we move into who gets what, and how control passes, so your farm succession plan actually works in real life.
Ready to start your farm succession planning?
If your current plan is basically, “It’s all in the will, that’ll sort it” – it won’t. Not on its own.
What can happen, though, is that you sit down with us for a structured farm succession planning session, run the numbers properly, and see what’s possible for your family.
Next step: take our preserve, protect and prosper farm succession scorecard
Before we talk structures, tax and who gets what, we want to know where you’re really at.
That’s why we’ve developed a simple farm succession scorecard under our Preserve, Protect and Prosper framework. It’s a quick way to pinpoint your risks and opportunities – and it starts the right conversation.
Preserve – are you keeping what you’ve built?
This part of the scorecard looks at whether you’re actually preserving the wealth you’ve worked so hard to create, including:
How much land is still in personal names
Your exposure to capital gains tax and stamp duty
Whether you’re using available concessions and rollovers
How dependent your plan is on “it’s all in the will”
If death duties are introduced, what will the impact be?
How is aged care being funded?
We’re asking: How much of your farm’s value is at risk of leaking away in unnecessary tax and costs?
Protect – is your farm and family insulated from shocks and are assets safe from claims?
Here we look at how well you’re protecting the farm and the family, such as:
Whether your structures shield the farm from relationship breakdown, creditors and disputes
Related party loan accounts particularly between entities and individual family members
How clearly roles, control and decision-making are set out
How prepared you are for unexpected events – illness, death, divorce, rule changes
Whether your current set-up is likely to cause conflict between on-farm and off-farm children
We’re asking: If something went wrong tomorrow, how exposed would you be?
Prosper – is the next generation set up to succeed?
Finally, we look at how ready you are to prosper into the next generation:
Do you have a realistic, funded plan for bringing in the next generation?
Can you support off-farm children fairly without crippling the business?
Is there a clear path for growth, reinvestment and transition of control?
Does your farm succession planning actually support the farm being viable in 10–20 years?
We’re asking: Are you setting the next generation up to thrive, not just survive?
How the scorecard works
It takes around 4 minutes to complete
You answer a series of straightforward questions under Preserve, Protect and Prosper
You receive a simple gauge of where you’re strong and where the gaps are
We then use your scorecard in a farm succession planning meeting to talk through practical next steps tailored to your situation
Book your farm succession planning session
If you’ve read this far and you’re wondering where your family sits, the next step is easy:
Complete our Preserve, Protect and Prosper farm succession scorecard
Book an appointment with Future Accounting Group to go through your results
Walk away with clarity, not just more worry
Make an appointment with us today and let’s see whether there’s a smarter way to preserve, protect and prosper with your farm.
Disclaimer
This article does not constitute financial advice and is for general information only. It does not take into account any individual’s personal objectives, situation or needs, and is not intended as professional advice. Any similarity to an individual’s personal circumstances and the examples provided in this article is purely coincidental. Any person acting upon such information without receiving specific advice, does so entirely at their own risk.
Authorisation under an Australian Financial Services Licence (AFSL) is not required in the provision of this article and the author plus Future Accounting Group Pty Ltd is not acting in its capacity as an Australian Financial Services Licence holder
Liability limited by a scheme approved under professional standards legislation.
