CLONAKILTY Bank of Ireland branch hosted an agri-business seminar in Fernhill House Hotel on Tuesday evening under the theme of ‘Preparing for growth, planning for success’.
The event, which was very well attended by farmers and agri businesses from Clonakilty and the surrounding areas, covered such topics as efficient tax planning, funding farm expansion and growing your business beyond your own farm gate.
There were a number of interesting speakers in attendance, including Michael Fitzgerald from FDC Accountants, who provided a really helpful insight into alternative farm structures and tax planning.
He also gave an analysis of the tax benefits of the various structures available to include farm partnerships, incorporation, as well as the implications of converting from a sole trader to a limited company. During his very detailed presentation, Michael also focused on tax planning for farm transfers and highlighted the importance of updating your will following incorporation.
Commenting, he said: ‘Many farmers who incorporate do not realise that they no longer own stock, machinery and entitlements and that shares and Director’s loans fall into residue unless specified in your will to go elsewhere’.
John Fitzgerald, Agri Development Manager, Bank of Ireland, outlined how agriculture is a key growth sector for the bank. This is underpinned by a €1 billion fund to support the ongoing development of the agri sector up to the end of 2017.
He also outlined the overall debt levels on Irish farms, which are about half the European average. His discussion also covered how Bank of Ireland is responding to expected future volatility in commodity markets by creating new and flexible loan facilities such as its Agriflex products that allows Bank of Ireland customers to temporarily convert their farm loan repayments to interest only during periods of commodity price shocks and/or spikes in input costs. These products have been very
welcomed by farmers as it allows them to better manage their cashflow during periods volatility.
Pat Ryan, a well-known dairy farmer from West Waterford gave a really interesting talk on his innovative farm partnership model which has allowed his business to grow exponentially beyond his own farm gate. Pat likened himself to many farmers in West Cork who are restricted in expanding due to a lack of availability of suitable land.
However, he was determined to maximise his own potential and therefore sought out other like-minded farmers with a view to forming a partnership together. He detailed the essential ingredients involved in setting up a farm partnership.
Speaking, having set one up, he said that successful partnerships work where core values are aligned, where there is trust and transparency as well as a desire to work openly with each other.
Following the presentation, there was a lively questions and answers session, where questions focused on tax benefits with leasing land to a limited company, where interest rates are likely to go in the future, pledging security for farm loans and the impact of the abolition of the milk quotas on farm partnerships.