The Autumn 2024 Budget introduced significant changes to Agricultural Property Relief (APR) and Business Property Relief (BPR). Previously, qualifying agricultural land and business assets could attract 100% relief from Inheritance Tax (IHT), allowing family-owned farms and businesses to pass wealth to the next generation largely tax-free.

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From 6 April 2026, the Government has capped 100% relief at £2.5 million per individual for combined qualifying business and agricultural property. Any value above this threshold will receive only 50% relief, meaning an effective IHT rate of 20% on the excess. The cap applies across both APR and BPR, affecting family farms, unlisted trading companies and other family enterprises that previously benefitted from full relief.

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Why Family Business United Opposes the Changes

Family Business United has long campaigned for the protection of APR and BPR, arguing that these reliefs are essential for the continuity of family enterprises and the preservation of regional economies. The new cap risks placing significant tax burdens on family businesses at the very moment they are planning succession or growth, potentially forcing sales or dilution of ownership to meet IHT liabilities.

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Family Business United continues to advocate for a reversal of these changes, emphasising that:

- APR and BPR are not tax loopholes but practical measures to ensure multi-generational family businesses can continue operating.

- Family businesses provide employment, skills, and investment across communities, and undermining reliefs could have broader economic consequences.

- A return to full relief, particularly for genuine family-owned enterprises, would safeguard long-term stewardship and continuity, protecting businesses from forced asset sales or restructuring.

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Looking Ahead

Family Business United will continue to engage with policymakers, lobby for legislative review, and provide guidance to family businesses navigating the new relief rules. For many families, understanding the implications of the £2.5 million cap will be critical to succession planning, and Family Business United remains committed to supporting its members through these changes.

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Family-owned enterprises remain the backbone of the UK economy, and Family Business United will continue to fight for policies that protect them.