The 2024 Autumn Budget included the announcement of changes to Agricultural Property Relief (APR) and Business Property Relief (BPR).
As a result, new Inheritance Tax (IHT) rules, set to take effect from April 2026, could create substantial tax liabilities on death.
Farmers, business owners and Alternative Investment Market (AIM) investors are amongst those affected. Assessing your estate planning has therefore never been more important.
With further changes to these reliefs announced in the Chancellor’s 2025 Autumn Budget speech, now is the time to prepare.
What changes have been brought in for APR and BPR?
The Chancellor has confirmed that any unused £1 million allowance for the 100 per cent rate of APR and BPR will be transferable between spouses and civil partners, even if the first death was before 6 April 2026.
However, the reforms still mean that any value above the £1 million threshold will only receive 50 per cent relief.
This will create a 20 per cent IHT charge where the combined thresholds – nil-rate band, residence nil-rate band and APR/BPR – are exceeded. For a couple, this means that they could have an effective threshold of up to £3 million.
For some people, this brings a significant change to their estate, as business and agricultural assets were commonly held under the assumption they would pass tax-free upon death.
How may these changes affect you?
Individuals should review their IHT position and consider whether any action is required.
The lack of additional measures mean that the estate of anyone relying on the traditional approach of passing assets upon death, may be at risk of unexpected tax liabilities.
To protect your family wealth, it is important to seek professional help when assessing how the new APR and BPR limits will affect you.
Our specialist team can advise you on your estate planning options and assess further business assets and partnerships.
Do you want to know if the new APR and BPR changes affect your estate? Speak to our team today.
