The (im)possible with power

The agricultural sector is confronted with many major and, fortunately, minor challenges. One problem is even well known to many entrepreneurs in the sector. I am referring to the situation in which the farmer decides to discontinue his business. The following question often arises: how can I best invest the released capital?

The word 'problem' is by no means an exaggeration in the context. The ultra-low interest rates make it unattractive to place funds in the bank. The disturbed confidence in the bank does not make things any easier either. The risk profile and additional lack of 'know-how' when it comes to investments also move relatively few farmers in that direction. But, what does work?

Tax choices for termination
The process of consideration actually begins before the decision is made to close the business for good. It is very important to make the right tax choices at that time. But that also immediately raises questions, because most entrepreneurs have little affinity with the subject. The terminology is difficult and the costs involved in this step are high. So there is a lot of hesitation.

That's a shame, because there is a lot of tax money to be saved. A good advisor can provide the doubting farmers with the necessary clarity in these difficult issues. In the discussions, investment options are often discussed that would not have come to light without the tax advice. Please note, because a tax specialist is a different person than a bookkeeper.

Various options
Tax advice requires expertise, but also persuasiveness and a lot of trust; after all, many entrepreneurs opt for the 'easy' or familiar route. There is certainly something to be said for that, but in most cases there are options that are much more attractive for the stopper. This is where we come in as a real estate advisor, because we can provide the guidance they desperately need. A few examples from our own practice:

• When we look to the future, sustainability is the topic. Participation in sustainability projects can therefore be an attractive option.
• This also applies to involvement in infill sites, because the shortage of housing is only increasing. Investments in the development of residential locations can therefore be very profitable, with rental of homes offering an extra option.
• Finally, recreation is a growing sector. The development and rental of holiday homes offers many possibilities. Not only in the Netherlands, but also abroad.

It should be clear: there are plenty of investment opportunities for the quitting farmers. In most cases, the released capital will yield a very acceptable return. Moreover, the risk of this type of investment is certainly defensive.

There's work to be done
Given the number of agricultural entrepreneurs who are considering stopping their business, there is work to be done. With appropriate advice, they can realize another nice source of income after their strike; sometimes even outside the agricultural sector!

Hans peters

Hans Peters of Q&Q Business is active as a broker, REV appraiser and expropriation and production rights specialist. He is also involved in general redevelopment projects and the emigration of agricultural entrepreneurs.

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