Renting land ,wirh gentlemsns agreement

Boomerang

Member
Old chap has been renting out his 60 acre farm forv20 years iish to the same two people.
I block each. Both gentlemen agreement no legal paperwork at all .
All parties have worked this way forc20 years rent always paid on time , no issues, land looked after. Everyone's happy.
Old chap has now decided after a prod from a non agri ,not involved sibling that he should get a proper rental agreement , citing tax implications.
Opinions please.
 

ISCO

Member
Location
North East
Always best to have a written agreement for all concerned. I think written FBT may benefit landlord for inheritance tax and easier to deal with HMRC if a written agreement exists.
If only 20 years possession then the unwritten agreement will be an FBT. However, if occupation commenced pre 1996 the tenant may try to claim AHA which is not good. If written FBT agreed now this rules out claim for AHA and removes a potential dispute now or when landlord dies.
 

7610 super q

Never Forgotten
Honorary Member
If the tenants are gentlemanly, they will happily sign an agreement.
If they are scum sucking butt fluffs, they will claim squatters rights, and claim AHA.
I'd be worried. Folks that rent land/ sheds for longer than 5 years, seem to think the property belongs to them for some reason. 🤷‍♂️
Be afraid, very afraid.
 

Tamar

Member
I rent some land on a Gentlemans agreement.

Every year the landlord says his accountant ask him to get a more informal agreement for inheritance tax reasons. Every year I say that's fine, but it never happens.

The difference is that I will never abuse the trust of a handshake.
 

ISCO

Member
Location
North East
I may not have been clear, l meant a full blown 1954 business tenancy which is interminable, not an FBT.
1954 landlord and tenant act would not apply if the land had been used for agricultural purposes. The risk would be they claim an AHA tenancy and assign to a limited company, this would then carry on indefinitely.
There are certain grounds a1954 act business tenancy can be ended eg if landlord wants to use for own business or develop
 

Boomerang

Member
Do does it have to be a full.on FBT, lawyer job.
Or can you draught up your own agreement?
Rolling annual agreement with both parties free to quit at any time.
 

Flatlander

Member
Arable Farmer
Location
Lorette Manitoba
I’d advise the tenant’s that they will be required to sign a new agreement or risk loosing the land. Faced with loosing the ground and a legal bill if any claims are attempted signing might be easy. But this needs to come from the old chap not a non farming pushy relative that considers themselves superior to a farmer.
 

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