Farming uncertainty: reviewing your business and succession plans

16th Oct 2026

Author: Michael Bracegirdle

Farmers are facing a difficult autumn, with uncertainty over funding adding to the pressures of a dry summer, disease outbreaks and rising costs. Concerns raised with our team at the recent Cheshire Ploughing Match showed how strongly these issues are being felt within the farming community.

Mike Bracegirdle explains why this is a useful time to review your farm’s business structure and succession plans, and how our teams can help you consider the options.

Funding uncertainty and financial pressure

The rapid closure of the second Sustainable Farming Incentive (SFI) application window on 22 September left farmers who had hoped to secure an agreement unable to apply. Defra subsequently confirmed that £253 million had been allocated to Window 2, including additional funding.

Defra plans to offer SFI again in 2027 and is considering changes to the application process. For those who missed out this year, however, questions remain about how to replace the income they had expected.

The summer’s dry conditions have also affected farm finances. AHDB’s final harvest report found average winter wheat yields around 11% below the five-year average, with oats around 14% lower. Bluetongue outbreaks and higher input costs have added to the difficulties facing farming businesses.

These pressures make it important to understand how your farm’s existing arrangements work and whether they still meet your needs. Reviewing them can help you make informed decisions about the business now and its future ownership.

How are your farm assets held?

The trading business and the land it uses are not necessarily owned in the same way. Land and buildings may belong to individual family members, be jointly owned or form part of the business’s assets.

A useful starting point is to check who owns the main assets, how the business uses them and what your agreements say. Where arrangements have developed over many years, the documents may not reflect how the farm operates today.

Borrowing also needs to be considered. Which assets have been offered as security? Has anyone personally guaranteed a business debt? These details matter when assessing the risks to the farm and whether a different arrangement could help.

Could a different business structure help?

For some farms, it may be appropriate to separate the trading business from ownership of the land and buildings. A limited company or limited liability partnership may be among the options to consider.

A limited liability partnership generally limits its members’ personal responsibility for business debts. A limited company also has a legal identity separate from its owners. However, neither arrangement automatically protects all the farm’s assets.

For example, land offered as security may still be at risk if borrowing cannot be repaid. A personal guarantee can also make an individual responsible for a debt if the business cannot pay. Changing structure does not remove existing obligations.

The right approach depends on your ownership arrangements, borrowing and plans for the business. Our Agriculture & Rural Affairs Team works with our Corporate & Commercial Team and your accountant to assess the options and their legal and tax consequences before changes are made.

Review succession alongside your business plans

Alongside your business plan, it is important to have a workable succession plan. This should consider how the farm will continue to operate as well as who will inherit it.

Who is expected to take over, and do they want that responsibility? What income or accommodation will the retiring generation need? How will family members who do not work on the farm be provided for? Discussing these questions early gives everyone an opportunity to explain their expectations.

Your Will and business agreements should reflect the same intentions. If ownership or management arrangements change, those documents should be reviewed together.

Take account of Inheritance Tax changes

Changes to agricultural property relief and business property relief took effect on 6 April 2026. These reliefs can reduce the value of qualifying assets when calculating Inheritance Tax.

A £2.5 million allowance now applies to the combined value of assets qualifying for the 100% rate of these reliefs. Qualifying value above the allowance generally receives 50% relief. Unused allowance can be transferred to a surviving spouse or civil partner.

The effect on your family will depend on which assets qualify and the wider estate. Most unused pension funds and pension death benefits will also be included in the Inheritance Tax estate from 6 April 2027, so that future change needs to be considered when reviewing your plans.

Advice for your farm and family

Our Agriculture & Rural Affairs Team works closely with our Corporate & Commercial and Wills, Trusts & Estates Teams to review business structure and succession together, alongside your other advisers.

If the current uncertainty has prompted you to reconsider your arrangements, contact Mike Bracegirdle for an initial conversation. He can discuss your concerns and involve the colleagues best placed to help you decide what to do next. Alternatively, complete the enquiry form.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information in this article was correct at the time of publication. The information is for general guidance only. Laws and regulations may change, and the applicability of legal principles can vary based on individual circumstances. Therefore, this content should not be construed as legal advice. We recommend that you consult with a qualified legal professional to obtain advice tailored to your specific situation. For personalised guidance, please contact us directly.