Major reforms to Inheritance Tax (IHT) came into force on 6 April 2026 which have changed how farms and family businesses are passed on to the next generation.
These changes present a significant shift in IHT planning, making it even more important to get the right advice and review your existing plans carefully, says Abbie Crystal, partner and agricultural specialist at Bendles.
From April, Agricultural Property Relief (APR) and Business Property Relief (BPR) no longer offer unlimited Inheritance Tax relief.
Instead, 100% relief is capped at £2.5 million per individual, with anything above that receiving 50% relief, creating an effective IHT charge of 20% on the excess.
In practice, this matters because many farming families and business owners are often asset‑rich but cash‑poor. Land, buildings, machinery or shares may carry significant value on paper but they do not always generate the liquidity needed to meet an IHT liability.
Without careful planning, beneficiaries could find themselves under pressure to sell land, borrow funds or restructure a business simply to pay tax.
Legal advice plays a crucial role in helping clients understand how these rules apply to their specific circumstances. Ownership structures, partnership agreements, Wills and succession arrangements all need to be aligned.
For couples, the ability to transfer unused relief between spouses can make a substantial difference but only if this is planned for properly and documented correctly.
The key message is not to wait until it is too late. Reviewing your position now gives you time to explore the options available and put robust plans in place.
If you’d like to discuss how the IHT changes may affect you, get in touch with Abbie on 01228 522215 or email amc@bendlessolicitors.co.uk
