Scottish Tenant Farmers Association

News Release

26th August 2019




The Scottish Tenant Farmers Association (STFA) warmly welcomes today’s publication of the latest Guidance on Succession from the Tenant Farming Commissioner, Bob McIntosh, which summarises some of the legal basics and outlines the ways in which an agricultural tenancy can be passed on to another person.

Succession planning is important to all farming businesses, especially to tenant farmers who are not only faced with handing over the business assets to the next generation but also have to consider the best way to pass on the lease on the tenanted holding. Traditionally the farming lease could only be transferred to a restricted group of near relatives following the death of the tenant. The succession process presented a number of tripwires for the unwary and gave the landlord additional grounds to object to the tenant for up to two years. In short it provided an opportunity to take advantage of a break in the lease and explore the possibility of taking the land back in hand, and without taking expert legal advice, a number of tenanted families lost the secure family tenancy.

The position has dramatically altered since the 2003 Act with a number of reforms to succession, culminating in the 2016 Land Reform Act which have widened the class of people who can now inherit a 1991 tenancy. The process of assignation and succession has been simplified and many of the obstacles removed, including the infamous “two man rule” restricting the size of holdings being transferred.

Commenting on the new Guidance, STFA Director, Angus McCall said; “Succession planning and encouraging the next generation into agriculture is very much top of the agenda just now. Changes in tenancy law over the past couple of decades have broadened the scope of succession and simplified the process of reducing the average age of the tenant farmer. Gone are the days when elderly tenants found themselves “stuck” in their tenancies, having to wait till after their day before passing on their lease and then only to a small group of close relatives.

“The straitjacket of succession has now been loosened and tenants can now transfer their farming businesses at the time of their choosing to a much wider class of relative, allowing them to step aside and avoid many of the pitfalls which can still exist in relying on succession after death. Lifetime assignation of a tenancy has been one of the success stories of tenancy reform with dozens of older farmers now able to enjoy a well-earned retirement with the next generation safely ensconced in the tenanted family farm.

“Transferring a tenancy is still complicated and requires good legal advice, but Bob McIntosh’s Guide to the Transfer of Tenancies by Assignation and Succession will greatly assist succession planning and prove to be a valuable handbook to all tenants as they plan the best way to pass their tenancies on to the next generation.”