Readers’ forum: Tax implications of farmland passed on during mediation

My client is a sole trader farmer. One of his adult sons has been actively assisting his father on a full time basis essentially from his teenage years right through to the present time when he is middle aged. The son has worked for very low recompense save for an assurance that one day he would become the owner of the farming business.

In recent years this father son relationship has soured due to (among other things) the father’s reluctance to ‘sign over’ any of the farmlands to his son. In consequence the son took a proprietary estoppel law case and eventually the case was resolved outside the High Court on the day of the scheduled hearing with the son being awarded a substantial portion of the farmland involved. The written agreement resolving the matter was made the subject of...