The UK Government has announced significant changes to Agricultural  Relief (APR) and Business Property Relief (BPR) as part of the Autumn Budget 2024. 

Perhaps the most significant of those changes are set to take effect in April 2026 and will impact many estates, particularly those with substantial agricultural and business assets.

Agricultural Property Relief (APR)

From 6 April 2026:

• A £1 million cap will apply to the amount of agricultural property that can qualify for 100% relief. This amount is not transferable between spouses if unused.
• Any value above £1 million will only qualify for 50% relief.
• This cap applies per individual or trust, and will refresh every seven years for lifetime gifts.

The Environment, Food and Rural Affairs Committee (EFRA) has published a report calling on the Government to delay announcing the final version of the reforms until October 2026 and for these to come into effect instead in April 2027 to allow for the better formulation of tax policy and the setting out of a long-term vision for farming. The Chair of EFRA stated that the government seems to be dismissing farmers’ concerns. Legal professionals alike would welcome a bit more breathing space after the detailed legislation is available in order to digest this.

Business Property Relief (BPR)

From 6 April 2026:

• The same £1 million cap will apply to BPR at 100%, with 50% relief on the excess. Again, this is not transferable.
• Unlisted shares (e.g. AIM-listed companies) will no longer qualify for 100% relief—they will be eligible for 50% relief only.

This change is expected to affect around 1,000 estates per year, particularly those with significant holdings in private companies.

Impact and Planning Considerations

These reforms aim to target reliefs more fairly and reduce the tax advantages enjoyed by the largest estates. Data obtained by wealth advisors Saffery indicates that 530 estates worth more than £1 million claimed an average BPR of £3,735,000. Under the new rules, the average IHT bill for these estates will now be £547,000.

Families with farms or private businesses should review their estate plans now to consider:

• Lifetime gifting strategies
• Trust planning
• Business succession and liquidity for IHT

Should you wish to discuss your own circumstances and explore any planning that you may benefit from undertaking now, please get in touch with our PPM team.