IHT: What’s changed and where to find help

Rising land values, diversified income streams, and increasingly complex ownership structures mean more farming families are now facing IHT exposure than ever before. Agricultural property relief (APR) and business property relief (BPR) remain essential tools in protecting family farms from significant tax bills but the rules governing those reliefs are changing.

What’s changed?

The UK Government has announced that from April 2026, a new cap will apply to both APR and BPR. Under the new rules, each individual will be able to claim full relief on only the first £2.5 million of qualifying agricultural and business assets.

Any value above this threshold will receive 50% relief rather than the 100% relief available under the current system. This marks a significant departure from the previous approach, in which APR and BPR were uncapped as long as the assets met the qualifying criteria.

The government has framed this change as part of a wider effort to ensure that the tax system remains fair, sustainable, and balanced, while still offering protection for genuine agricultural and business activity. For many farming families who had long assumed their entire farm would qualify for full relief, these changes represent a major shift in how estates may be assessed in the future.

Why it matters

These changes have significant and immediate implications for family farms. Farmland values have risen sharply over the past decade, which means that even modest family farms may now exceed the new relief cap.

At the same time, many farms have diversified into areas such as holiday accommodation, renewable energy projects, commercial buildings, or contracting services, and these activities can complicate eligibility for BPR and increase the estate’s exposure to IHT.

Multigenerational farms may find themselves facing unexpected tax liabilities, which could create pressure to sell land, livestock, or machinery simply to meet the tax bill. Families who have long believed their farm was fully protected under the existing rules may now discover that a substantial portion of the estate could fall within the IHT net.

For farming families, the risk is not solely financial; it can be deeply emotional. Without proactive planning, the continuity of the family farm, the family home, and the livelihoods of future generations could all be placed at risk. This is why specialist financial planning has become essential – and why Succession Wealth believes it is well placed to help farming families protect their land, their business, and the legacy they hope to pass on.

Support

Succession Wealth is an independent financial advice firm with offices across the UK, but its strength lies in how the team work locally. The company’s financial advisers live and work within the rural communities they support, bringing genuine local knowledge of farming practices, land values, regional diversification trends, and the practical realities of running a farm. It is this combination of national strength and local expertise that makes them a trusted partner for farming families planning for the future. Succession Wealth can help farming families:

• Understand how the new APR/BPR rules will affect their estate
• Review ownership structures and land use
• Identify risks and opportunities early
• Build long-term, tax-efficient strategies to protect the farm
• Use trusts, gifting, insurance, and legacy planning to create stability across generations.

Whether the goal is succession planning, intergenerational transition, or protection against future tax liabilities, every recommendation is tailored to the family’s values and goals. Just as importantly, Succession Wealth advisers can help prepare the next generation by ensuring younger family members understand their financial responsibilities and the legacy they will inherit.

Protect the farm

Effective IHT planning protects decades of hard work, strengthens family relationships, and ensures the farm, which is so often the heartbeat of rural life, remains in capable hands. Succession Wealth can provide farming families with the expertise, tools, and longterm planning they need to safeguard what matters most.

If you want to ensure your farm and legacy are protected for generations, contact Succession Wealth directly and the team will put you in touch with a local adviser you can trust to help secure the future of your family farm and finances. 

Please note: This article is for general information only and does not constitute advice. The information is aimed at retail clients only. The content was accurate at the time of writing, changes in circumstances, regulation and legislation after the time of publication may impact on the accuracy of the article.

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