On 23 December 2025, HM Treasury confirmed that, effective 6 April 2026, the threshold for 100% Agricultural Property Relief (APR) and Business Property Relief (BPR) is being raised from £1 million to £2.5 million per person.
How Much Does This Equate To?
As a result, couples can now pass up to £5 million in qualifying agricultural or business assets tax-free, in addition to the usual nil-rate bands (of £325,000 each), therefore totalling a potential full inheritance tax relief on the value of farms up to £5,650,000. Assets above the new threshold will still qualify for 50% relief.
The Aim Of The Adjustment
This adjustment is designed to ease the burden on family farms and small businesses, many of which were concerned about the impact of previous proposals. By increasing the threshold, the Government expects that around 85% of estates claiming Agricultural Property Relief will pay no inheritance tax at all. The number of estates affected by the changes will fall significantly, from 375 to 185, offering reassurance to families planning for succession.
Succession planning
For landowners and rural businesses, this is an opportunity to revisit succession plans and estate strategies. The higher threshold provides greater flexibility and security for passing on core assets to the next generation.
How Can Luscombe Maye Help You?
At Luscombe Maye, we have a specialist team of professionals of whom are ready to help clients understand how these changes apply to their circumstances and ensure they make the most of the new reliefs.
If you would like to discuss how this announcement affects your estate, please get in touch with our Rural Professional Department on 01364 646 177 or 01548 800 183.
