What do you pay your parents?

munkus

Howye,

Will be taking over the farm in a few months. Both parents will be drawing pension but no income other than that. I'll be still working full time and old boy tipping away on the farm each day as usual. I want to make sure that they're comfortable so I want some arrangement of paying them. How is this done from an accounting point of view and what kind of arrangements have you guys in place? I'd like to start with a 50/50 profit sharing arrangement and see how is it goes. I know this is a very personal and subjective topic and no two families or farms are the same but I'd like to hear your thoughts on the issue.

Thanks.

Mulumpy

munkus wrote: »

Howye,

Will be taking over the farm in a few months. Both parents will be drawing pension but no income other than that. I'll be still working full time and old boy tipping away on the farm each day as usual. I want to make sure that they're comfortable so I want some arrangement of paying them. How is this done from an accounting point of view and what kind of arrangements have you guys in place? I'd like to start with a 50/50 profit sharing arrangement and see how is it goes. I know this is a very personal and subjective topic and no two families or farms are the same but I'd like to hear your thoughts on the issue.

Thanks.

My mother only has her pension so I pay all her household bills

iverjohnston

If they are on a non-contributory pension, you cannot show any payments in your accounts. Or their pension will be cut by a similar amount. But there are lots of little comforts you can look after for them.

bogman_bass

munkus wrote: »

Howye,

Will be taking over the farm in a few months. Both parents will be drawing pension but no income other than that. I'll be still working full time and old boy tipping away on the farm each day as usual. I want to make sure that they're comfortable so I want some arrangement of paying them. How is this done from an accounting point of view and what kind of arrangements have you guys in place? I'd like to start with a 50/50 profit sharing arrangement and see how is it goes. I know this is a very personal and subjective topic and no two families or farms are the same but I'd like to hear your thoughts on the issue.

Thanks.

I dont pay a wage even though the old lad still does a good bit for me.
However we had it signed into the transfer agreement that should either of my parents have to go into a nursing home I have to provide for theur care.

Now its something I'd do anyways but its good for them to have that legal certainty that they'll be provided for.

grazeaway

yeah it can be a sticky one. the folks are retired a few years now, i'm leasing the farm from them and they are drawing thier pension. my mum does very little on the farm nowadays but my dad is still active and keepts things ticking over while i'm at work. dont pay him for it but do contribute to thier expenses.

kevthegaff

im paying aa amount per month to my mother who has a pension and gets rent of the wind turbines on the land, also i took over some land loans. My brother takes care of the auld lad as he has a separate farm at home

delaval

iverjohnston wrote: »

If they are on a non-contributory pension, you cannot show any payments in your accounts. Or their pension will be cut by a similar amount. But there are lots of little comforts you can look after for them.

Iver,
There was a time when to have them on a partnership was a big advantage as they would have allowances that could be written off against tax. Maybe this has changed, my brothers used this very well on the home farm

royalmeath

bogman_bass wrote: »

I dont pay a wage even though the old lad still does a good bit for me.
However we had it signed into the transfer agreement that should either of my parents have to go into a nursing home I have to provide for theur care.

Now its something I'd do anyways but its good for them to have that legal certainty that they'll be provided for.

If you have to pay for your parents to go into a nursing you might as well sell
the whole place. It costs between 700 to 1000 euro a week in all nursing homes. When I took over the home place my parents got it in the transfer that all household bills would be paid etc. My own father had to go into a nursing home for the last year of his life and if I had to pay for it I would be on the road now.

Seaba

iverjohnston wrote: »

If they are on a non-contributory pension, you cannot show any payments in your accounts. Or their pension will be cut by a similar amount. But there are lots of little comforts you can look after for them.

I am in a bit of trouble here then.
Everything is in my name. Both my parents are on a non-contributory pension. We set up a Farm Bank Account in my name and put through all the farm receipts and expenses through this. The thing is if the parents have to buy something expensive e.g. TV or do something with their car, they use the farm account money to pay for it rather than their own.

Could this result in my parents pension being cut?
Thanks

rancher

royalmeath wrote: »

If you have to pay for your parents to go into a nursing you might as well sell
the whole place. It costs between 700 to 1000 euro a week in all nursing homes. When I took over the home place my parents got it in the transfer that all household bills would be paid etc. My own father had to go into a nursing home for the last year of his life and if I had to pay for it I would be on the road now.

My father was five years in a nursing home, it nearly cleaned me financially along with 20% interest rates

y0ssar1an22

I dont know how farm accounting/tax works but surly there is a way for you to take money out of the farm and give it to your parents in cash? Or could you gift it to them somehow? Or could you expense the TV and/or car stuff somehow as being farm related expenses?

lakill Farm

y0ssar1an22 wrote: »

I dont know how farm accounting/tax works but surly there is a way for you to take money out of the farm and give it to your parents in cash? Or could you gift it to them somehow? Or could you expense the TV and/or car stuff somehow as being farm related expenses?

Drawings


I take 1.5 acres between the auld pairs back garden and that of the next door neightbour.

He gets the tractor to draw his turf, some timber and 200 silk cut purple for 0.75 acres and half a load of dung for the spuds

My auld pair get the other half load of dung and i normally draw the turf. very handy to have the bit of ground for a few calves and they look after them.

iverjohnston

Seaba wrote: »

I am in a bit of trouble here then.
Everything is in my name. Both my parents are on a non-contributory pension. We set up a Farm Bank Account in my name and put through all the farm receipts and expenses through this. The thing is if the parents have to buy something expensive e.g. TV or do something with their car, they use the farm account money to pay for it rather than their own.

Could this result in my parents pension being cut?
Thanks

The account is in your name, so if the parents should happen to be checked up on, it will not show up. The fact that they have access to a cheque book for that account is a happy co-incidence

Very often a retired couple find that with over €420 a week coming in, they have more disposable income than at any time in their working lives.
I have an aunt in Northern Ireland, and she cannot believe the amount the Old Age pension pays here. In NI you would be nearer £90. a week per person.

whelan1

rancher wrote: »

My father was five years in a nursing home, it nearly cleaned me financially along with 20% interest rates

maybe... but at the end of the day they clothe and fed ya and looked after you til you could do it yourself.... you are probably working their land...

freedominacup

Is everybody making their annual PRSI contributions? Cheapest pension you can get.

epfff

I'm same as previous poster mother has axis to farm account for the big stuff. And her esb phone vhi etc all come dd from farm ac
when oil man comes to my house I fill hers as well
she also gets small lumpsum cash before xmas as that's when it suits me best
no written agreement so she often very nervous and can be heard saying to my wife (who she gets on with better than me) when he dies will you leave me on the road

whelan1

epfff wrote: »

I'm same as previous poster mother has axis to farm account for the big stuff. And her esb phone vhi etc all come dd from farm ac
when oil man comes to my house I fill hers as well
she also gets small lumpsum cash before xmas as that's when it suits me best
no written agreement so she often very nervous and can be heard saying to my wife (who she gets on with better than me) when he dies will you leave me on the road

we have a written agreement... took a long while but it suits us both, to those of ye that dont have one , why dont you have one?

rancher

whelan1 wrote: »

maybe... but at the end of the day they clothe and fed ya and looked after you til you could do it yourself.... you are probably working their land...

Not begrudging anyone, but just warning what can happen, still got a cheap farm, had just built a house, etc, I was only 23

Mulumpy

Seaba wrote: »

I am in a bit of trouble here then.
Everything is in my name. Both my parents are on a non-contributory pension. We set up a Farm Bank Account in my name and put through all the farm receipts and expenses through this. The thing is if the parents have to buy something expensive e.g. TV or do something with their car, they use the farm account money to pay for it rather than their own.

Could this result in my parents pension being cut?
Thanks

Not sure but if you got all invoices in your name I don't think there would be a problem.

bob charles

I pay no heed to them

grazeaway

bob charles wrote: »

I pay no heed to them

i'd say they pay even less to you

grazeaway

Seaba wrote: »

I am in a bit of trouble here then.
Everything is in my name. Both my parents are on a non-contributory pension. We set up a Farm Bank Account in my name and put through all the farm receipts and expenses through this. The thing is if the parents have to buy something expensive e.g. TV or do something with their car, they use the farm account money to pay for it rather than their own.

Could this result in my parents pension being cut?
Thanks

whose name is on the recipt? when you are putting in your accounts a telly would hardly be down as a business expense. buying stuff for your folks like food and things is not a problem as the tax is paid on it as vat and there are very few household items that can be put through as farm expenses anyway. i doubt the tax office would let you put in a sky box and tickets for red hurly as a farm expense.

my name is on the diesel for the farm as its mine as i pay for it. if my dad wants to use the tractors for his own bits a pieces thats fine by me.

i dont have a problem paying bills for the folks, they paid plenty for me over the years.

AlanS181824

This is a very interesting thread to read through, the fact that some of ye have a written agreement with your parents confuses me but I guess it would make the parents feel a lot more secure seeing as though they've written proof that you'll support them.

bob charles

grazeaway wrote: »

i'd say they pay even less to you

these young generation with notions

Timmaay

In partnership here, 50/50 split, but no written agreement as such yet. In terms of bills etc, its sort of all the one, so no big deal, when either wants money we draw it down from the farm account (assuming it's there ha). Between us as a family (me, my siblings and parents), We are slowly bashing out what happens in the future in terms of if they need care etc, of course we'll provide to help them at all, but equally so, they would not like to see land sold etc, and us on the breadline to provide for them. Moving forward we do hope to all have some sort of written agreement soon, this would obviously be important to me farming here in the future as things could get messy and very expensive quick. Its always a sensitive enough subject I'll admit, and a decision not to be rushed. But equally so, can't be left on the backburner till its too late.

rancher

Timmaay wrote: »

In partnership here, 50/50 split, but no written agreement as such yet. In terms of bills etc, its sort of all the one, so no big deal, when either wants money we draw it down from the farm account (assuming it's there ha). Between us as a family (me, my siblings and parents), We are slowly bashing out what happens in the future in terms of if they need care etc, of course we'll provide to help them at all, but equally so, they would not like to see land sold etc, and us on the breadline to provide for them. Moving forward we do hope to all have some sort of written agreement soon, this would obviously be important to me farming here in the future as things could get messy and very expensive quick. Its always a sensitive enough subject I'll admit, and a decision not to be rushed. But equally so, can't be left on the backburner till its too late.

Isn't there a rule in the fair deal scheme that a farm has to transferred five years in order for it not to be liable for nursing home bills

Muckit

grazeaway wrote: »

i'd say they pay even less to you

Ah not quite.... he's still getting his pocket money if he's been a good boy all week.

nashmach

rancher wrote: »

Isn't there a rule in the fair deal scheme that a farm has to transferred five years in order for it not to be liable for nursing home bills

Not just the farm, can relate to any asset.

And who knows what may happen in the future

longgonesilver

nashmach wrote: »

Not just the farm, can relate to any asset.

And who knows what may happen in the future

Very important point. All asset transfers for last five years have to be declared, and the value is added on.

The notional income from assets has gone up from 5% to 7.5% and could/will go further.

There is also a clause covering income "which you have deprived yourself of in the 5 years leading up to your application."

Waiting lists to get funding are getting longer.

What would happen if the HSE came across a written legal agreement promising to pay all nursing home care for your parents?

It is a good scheme, seems fair but how long will the state be able to fund it?

A person with little or no assets and only pension income can get full nursing home care for 80% of their pension.

keep going

built a nice tidy bungalow for my mother when we got married-close but not too close.we do all the motoring bills for her,fill the oil,house tax,coal timber,any household appliance repairs or new etc.the esb is free but she pays her telephone because she dosent want us to know how big it is:P.she seems to be happy enough with the pension then

ljcoolk

longgonesilver wrote: »

Very important point. All asset transfers for last five years have to be declared, and the value is added on.

The notional income from assets has gone up from 5% to 7.5% and could/will go further.

There is also a clause covering income "which you have deprived yourself of in the 5 years leading up to your application."

Waiting lists to get funding are getting longer.

What would happen if the HSE came across a written legal agreement promising to pay all nursing home care for your parents?

It is a good scheme, seems fair but how long will the state be able to fund it?

A person with little or no assets and only pension income can get full nursing home care for 80% of their pension.

Believe it or not funding lists are shorter than they have been this year.

In July the 5% increased to 7.5% on cash assets and non cash assets .

The HSE would still be obliged to offer the Nursing Home Support Scheme if applied for even if a legal agreement was in place. Nursing home fees always increase, never decrease.

tbh it would be ludicrous to try and pay privately when the scheme is in place, at least if the fees increased and you were under the scheme the cost implication would be on the HSE.

If two parents were to admit to long term care and you were paying privately depending on the particular unit you'd be forking out the guts of 90k a year madness