Are you worried about losing the farm under the Fair Deal Scheme?
Farm families are particularly attached to the land because it has provided their livelihood for years and it may have been passed down through the generations. This area has been quite muddled for a number of years and it is still not fully resolved until 90 days after legislation enacted by into law in July 2021 takes effect – that is around the 20th October 2021.
Many farmers have an expectation that they will be cared for at home by their family members but if someone develops dementia this may no longer be possible. Mobility is another important issue – if a farmer breaks his hip he may need to go into a nursing home. If a farmer enters a nursing home the family may be worried about losing the farm under the Fair Deal Scheme . If the farm was signed over to a family member at least 5 years earlier then the farm will not be considered for the purposes of the Fair Deal Scheme. But if the farm is still in the name of the older farmer or less than 5 years have elapsed since the transfer then the farm will form part of the calculation.
Up until recently there was no 3 year cap on the farm so if a farmer needed to go into a nursing home and he stayed there for six years, ten years or twelve years then the value of the farm was considered part of the financial contribution for all of those years. Obviously it is unknown at the commencement of the person’s stay in a nursing home how long he/she will have to remain there. Due to pressure brought by farming organisations the Government has since agreed to extend a 3 year cap to the inclusion of the farm in the Fair Deal calculation subject to certain conditions as follows:
- The family successor must have s farmed the land for 3 out of the previous 5 years and must have the Agricultural Green Certificate
- The family successor must sign a statutory declaration that they will continue to farm for the next 6 years.
- The successor must spend 50% of the working week farming the land.
Obviously this will not suit all farm families – some families do not have a successor willing to take on the farm or they may not meet the above criteria. If the land is let to a cousin or a neighbour then the family will have to pay on the value of the farm indefinitely. It is important to provide accurate up to date valuations because when the person dies there is a branch of Government that checks what assets were listed on the Revenue Schedule of Assets and compares that with the information provided on the Fair Deal application form.
If there is not enough money in the bank to pay the financial contribution it is possible to apply for an Ancillary loan. This means that a charge will be registered on the deeds of the property (usually the family home and/or the farm) in order to pay the nursing home for the duration of the person’s stay there. When the farmer dies the Revenue will need to be repaid out of the proceeds of sale or the successor will need to raise money by way of a loan in order to clear the Fair Deal (Nursing Home Support) charge from the deeds of the property.
If you are worried about losing the farm under the Fair Deal Scheme please go to www.emerlavineldercare.ie to book a consultation to discuss your concerns today. You won’t regret it.