Agriculture, Rural and Estates Archives

One farming family, over 30 years of trusted legal and financial advice

Posted on 12 April 202129 March 2025 by Sarah O'Sullivan

For over three decades, Tees has provided expert legal services to multiple generations of the Miller* family, a prominent agricultural family with extensive farming, land and property interests located across several English counties.

Our senior partner and specialist in rural succession and estate planning, Catherine Mowat, has worked closely with the Millers for many years, helping them capitalise on opportunities for efficient estate planning and take advantage of valuable Inheritance Tax reliefs.

Alongside Catherine’s team, our Commercial Property, Residential Property, Commercial and Wealth Management teams have worked together collaboratively in order to help the Miller family effectively manage their business and property interests.

Passing assets on to the next generation

Catherine has worked extensively with the Millers over a number of years to put in place comprehensive arrangements that will enable more senior family members to pass on their assets effectively to future generations, whilst minimising the Inheritance Tax (IHT) payable on their estate.

The family were advised to make substantial lifetime gifts to their children and grandchildren, enabling assets to be passed on to younger generations in a controlled way.

How does Inheritance Tax (IHT) work?

IHT is a tax on the capital value of assets (including money, property and possessions) either when somebody has died or on some gifts made during lifetime. On death, it is generally payable at a rate of 40% on all assets over the value of £325,000, although there are exemptions and reliefs that can be used to lessen the amount due. Another way of reducing the IHT payable on your estate is to make lifetime gifts. If you make gifts more than seven years before you die, there will usually be no IHT due on these gifts on your death. If tax does arise, only gifts given less than three years before you die attract the full 40% IHT rate, making lifetime gifts an excellent opportunity for passing on assets to minimise tax.

These lifetime gifts also caused the estate value belonging to the children to rise, increasing their IHT liability. Here, our Wealth team stepped in to help set up suitable life insurance arrangements, written in trust to minimise the impact of a significant tax bill.

Why should I write my life insurance policy in trust?

Writing your life insurance in trust is a way to avoid paying IHT on the eventual payout. When you place an asset into a trust, you essentially give up ownership of that asset to the trust and appoint trustees to oversee it (this can be a solicitor, like Catherine, or somebody else). As the assets (in this case, the life insurance policy) don’t officially belong to you, they aren’t classed as being part of your estate and are therefore not subject to IHT.

Catherine has also worked with the Millers to draft essential estate planning documents such as Wills and Powers of Attorney, and acts as a trustee for the various trusts within which the family’s business and property assets are held. Her many years spent advising this family have enabled her to build a strong relationship with the Millers, bound by mutual trust and respect.

Taking advantage of Inheritance Tax (IHT) relief

Over the years, our Wills, Trusts and Probate team has worked closely with the Millers to ensure their entitlement to valuable IHT reliefs. For example, Catherine’s advice has enabled the family to take full advantage of Agricultural Property Relief (APR) on their eligible assets.

What is Agricultural Property Relief (APR)?

APR allows farming families to pass on agricultural property at a reduced or 0% rate of IHT, either during a person’s lifetime or in their Will. To apply for APR, the land or property must have been owned for at least seven years, or occupied for two years and must be used for growing crops or rearing animals, or take the form of farm buildings, cottages or houses. It does not apply to farm equipment or machinery, derelict buildings, harvested crops or livestock. APR can be due at 100% or 50%, depending on the circumstances.

Catherine also regularly reviews the balance of the Millers’ business activities to ensure that no entitlement to Business Relief (BR) is lost, by using the ‘Balfour’ test.

What is Business Relief (BR)?

BR allows business owners to pass on certain business assets at a reduced or 0% rate of IHT, either while they are still alive or via their Will. The owner must have owned the assets for at least two years before they died for them to be eligible. BR is due at 100% for:

A business, or interest in one
Shares in an unlisted company

It is due at 50% for:

Shares controlling over 50% of the voting rights in a listed company
Land, buildings or machinery owned by the deceased and used in a business in which they were a partner or controlled
Land, buildings or machinery used in the business and held in a trust the business has the right to benefit from

To be eligible for BR, a business must also be classed as a predominantly trading business. However, many farms are becoming increasingly diversified, with activities such as cottage rentals and holiday lets shifting the balance from trading to investment.

Catherine used the Balfour test to assess the Millers’ farming business and used the results to advise the family on achieving the best balance between trading versus investment activities within the farming partnership for BR purposes.

Strategic land and property solutions

Our Commercial Property team regularly steps in to assist the Miller family in matters relating to the lease or sale of land and properties, which include a range of sites with commercially let units, and other strategic deals such as granting options. Rural specialists within our Commercial Property team will negotiate and facilitate these various land transactions.

An example of the type of planning advice we offer might be in relation to land owned by a family trust on which planning permission has been obtained for development. In this situation our Corporate team would step in to advise on the incorporation of a ‘freezer’ company.

The team would also prepare bespoke articles of association, ‘freezing’ the value of certain interests in the company in order to cap ownership. This ensures that the growth and value of the land will be passed on to the next generation tax-efficiently and limit their IHT liability.

What is a ‘freezer’ company?

Also known as a family investment company (FIC), a ‘freezer’ company is essentially a private limited company whose shareholders are all family members. Commercial solicitors can help the family prepare bespoke articles of association that set out the rights and interests each party holds within the company. For example, the parents can set themselves up as voting shareholders – thus maintaining control over the company – but ‘freeze’ the value of their interests in the company to cap their ownership.

Meanwhile, the children can be non-voting shareholders but own the majority of the shares, allowing the growth and value to pass on tax-efficiently to the next generation. This makes ‘freezer’ companies an ideal vehicle for intergenerational wealth management, allowing assets to be passed on during your lifetime whilst still retaining control of them. If you live for more than seven years after setting up the company, no IHT will be due (according to the rules of lifetime gifting).

A full- service firm rural families can depend on

For over a century, Tees has been a trusted partner to farming families like the Millers, helping them pass the family business from generation to generation. In this time, our agricultural specialists have developed a unique understanding of the challenges facing the rural community.

From tailored business advice to passing your land and assets tax-efficiently to the next generation, our specialist agricultural lawyers can help you navigate the complex relationship between business, land and family interests.

*Please note that the family’s name has been changed for anonymity.

Farming divorce: Protecting your family farm

Posted on 3 June 202023 March 2025 by Sarah O'Sullivan

A farm is usually a family business, but it’s more than simply an income. It’s an all-consuming occupation and a way of life. Divorce has become part of everyday life, and farming families are as susceptible as any other to a marriage failing. However, farming divorces are more complex, so it’s vital that you seek expert legal advice.

Clare Pilsworth, Partner in the Family Law team at Tees, outlines the challenges faced in a farming family divorce and identifies steps that can be taken to ensure that the farming business is protected from the outset.

If the worst were to happen and your marriage hits troubled times, we will provide you with the expert legal guidance and support you need.

What factors are considered in a farming divorce?

The primary aim in a divorce separation is to establish what the needs of each party are and how these needs may be met.

The courts have very wide discretion to reallocate assets within a marriage to ensure that both parties’ needs are met for the future. This could mean being forced to sell off land or property in order to raise cash, which will raise some important issues for your farming business.

The first step is to define the assets and decide how to share assets built up during the marriage. The Courts will then seek to ensure each party receives a ‘fair share’. A fair share, however, does not necessarily mean equal, and farming cases merit special consideration, including:

Inherited assets which are not subject to the sharing principle in the same way
A farm owned by the wider family, for example, with siblings, parents or both, will require careful thought as Courts are reluctant to damage the livelihoods of other third parties.
Provided there are sufficient liquid assets, the Courts can disregard equality in favour of protecting any inherited element

Whilst for non-farming divorces, an equal division of assets and wealth accumulated during marriage could be considered a fair divorce outcome, this may not always be achievable for farming families because of the need to preserve assets that were owned long before the marriage.

‘Fairness’, however, still requires financial needs to be met.

What about family members living on the farm?

You may have passed certain farming properties to your adult children or have allowed them to live in them to ensure that the needs of the farm can be met.

Where an adult child has received financial support or housing from a parent during the marriage which is then subject to divorce the Court can make an order against the child effectively forcing them to prevail upon parents or the extended family, to provide support in relation to financial settlement.

It is therefore important to be aware of the potential implication of deciding to financially assist children during their marriages. This is particularly relevant where a family’s wealth has been built through the farming generations, and the family want to prevent the farming business being broken up during divorce proceedings.

Do I need to go to court?

Contesting financial matters in Court within a divorce can be very costly and is not the only option open to you. The Courts are, therefore, placing more and more emphasis on non-court dispute resolution as a means of solving disputes because of the significant delays and expenses that come with court proceedings.

Non-court dispute resolution options, such as mediation, collaboration, and arbitration, are alternatives to court proceedings that seek to resolve matters as efficiently, cost-effectively, and amicably as possible.

How can I protect my farm?

Careful planning in advance is extremely important. By doing so, you can structure your arrangements taking full account of the specifics of your farming business and individual family circumstances.

There are several ways you can seek to protect your farming business along with future income streams:

Partnership Agreements

Partnerships are the most common business structure within the farming industry – they are relatively simple and a flexible way to run a farming business. By drawing up a partnership agreement, you will be able to ensure that it is made clear in writing exactly which assets belong to the partnership and which are owned by each partner as individuals.

Family Trusts

One way to protect the family farm is through a family or discretionary trust. This trust not only protects family assets but can also divide farm income to minimise tax.

A trust “owns” your family assets, such as the farm, investments, home, shares, or business, while you, your family members, or others might be beneficiaries under the trust.

Trusts can play a key role in protecting family wealth on divorce and can provide a means to assist adult children without risking farm assets. However, trusts should always be considered as part of a long-term strategy to protect family wealth, as a trust set up when a marriage is on the verge of breakdown is unlikely to withstand the scrutiny of the courts.

What about a prenuptial agreement?

Prenuptial agreements are an effective way of legally protecting your farming business, together with property and money acquired before a marriage. Entering into such an agreement before marriage allows you and your future spouse to plan how you will divide current and future assets should you divorce in the future.

However, there is something to be said for ensuring that the spouse marrying into the farming family does not feel excluded through entering a prenuptial agreement and, through the marriage, feels invested in the future success of the farm and business.

If a prenuptial agreement might be considered, it should be done so in light of the joint commitment of the marriage. It is that commitment which will make the farm succeed as well.

It is important to take expert legal advice from a family lawyer who specialises in dealing with farming assets on divorce to ensure that the terms of the prenuptial agreement are sufficiently robust to be upheld by a court.

Certain criteria must be fulfilled for the agreement to be upheld and it is important for both parties to receive independent legal advice.

Expert legal advice for over a century

Tees’ heritage and culture has been rooted in the local farming community in and around East Anglia for well over a century, and its legal experts, many of whom are from farming families themselves, have decades of experience in dealing with all aspects of legal farming matters.

Three new female partners tip the balance at Tees

Posted on 1 April 202030 March 2025 by Sarah O'Sullivan

Three new female partners have swelled the senior ranks at Tees Law, a Top 200 law firm with offices in Bishop’s Stortford, Brentwood, Cambridge, Chelmsford, Royston, and Saffron Walden. Letty Glaister, Eleanor Burroughs, and Kay Piper’s promotions to the partnership mean that female lawyers now comprise the majority of the firm’s partners. In a profession where women typically occupy less than a third of partnership roles, Tees is leading the way in supporting female lawyers to access senior positions and progress in their careers.

Commitment to diversity and equality

Tees’ head of HR, Amy O’Brien, commented: “Tees encourages and values diversity and is committed to equality for its entire staff. Fifty-three percent of partners at Tees are women, and having such a balanced split works really well for us. Each partner, be they male or female, brings different strengths and qualities to the team and contributes to driving the company forward. These principles of equality of opportunity and non-discrimination also extend to the manner in which our employees interact with our clients, our business partners, and our visitors.”

Kay Piper’s vision for commercial property

Kay Piper is head of Tees’ commercial property department in the Bishop’s Stortford office. Speaking of her appointment, Kay says: “I am looking forward to increasing the team’s presence and connections within the community, reaching out to build local awareness of Tees’ expertise in commercial property matters. I am also very keen to further develop a collaborative team within Tees, ensuring that we work together to deliver a joined-up service for our clients. Whilst the entire Tees team is currently working from home, we’re still working hard to keep connected with our clients and to each other. We’re actually finding that we’re communicating more than ever.”

Letty Glaister’s rural community focus

Letty Glaister, who heads up the Royston office, hopes to further strengthen her relationships within the rural community and cement Tees as the law firm of choice for farming clients throughout Hertfordshire and Essex. “It’s really important that our clients trust us implicitly, and that can only be achieved by making a real effort to strengthen our links with the surrounding community, especially during these difficult times when many rural families are feeling concerned and isolated due to social distancing measures,” she says. “Particularly in the rural world, maintaining close relationships is vital as we are dealing with farms that have been in families for generations, meaning that emotions can run high for all concerned.”

Eleanor Burroughs’ commitment to Saffron Walden

Eleanor Burroughs, who has been working at Tees’ Saffron Walden office for 11 years, heads up its residential property department. In addition to her partnership promotion, she has also been promoted to head of the Saffron Walden office, effective from April. Going forward as a partner, Eleanor says she is “looking forward to maintaining the close links we have worked so hard to build up with the local community, and to building the Tees brand.”

A message from the group managing director

Ashton Hunt, group managing director at Tees, is delighted by the three new partners’ success: “At Tees, we have always been assiduous in ensuring our female solicitors are supported in progression to senior roles. Letty, Eleanor, and Kay have all consistently demonstrated their excellence in their fields and commitment to our firm during their time here. Whilst leading their teams remotely during these challenging times, they continue to deliver a consistently excellent service to their clients. Their promotion to partner is thoroughly well deserved.”