Readers’ forum: What are the tax consequences of parents’ retirement?

I act for a farming partnership comprising of Father (F) aged 84 Mother (M) aged 81 Son (S) aged 54 and Daughter (D) aged 52. According to the partnership agreement the revenue profits and rents are divided equally with capital profits shared equally between the S and D only.

The home farm is owned by S and farmed by the partnership under licence. The partnership is to cease trading later this year when the farm will be let under an FBT with S and D remaining in the farmhouse.

Several pieces of land have also been purchased by the partnership over the years and included in the land capital account. At least six of the properties are let under FBTs with one subject to an AHA tenancy which only attracts 50% relief. Apart from one farm in four names the legal owners are S and D.

I...