Do you need to re-evaluate Business Property Relief (BPR) in your estate plan?

BPR is a valuable relief that can reduce or eliminate IHT on certain business assets. If a qualifying business or asset has been owned for at least two years, it may qualify for up to 100% IHT relief when passed on to beneficiaries.

Eligible Assets for BPR Include:

• Shares in unlisted trading companies, including those on the Alternative Investment Market (AIM)
• Ownership of a sole trade business or partnership share in a trading business
• Certain business assets, such as land, buildings, or machinery used in the business

However, with the government reviewing tax reliefs as part of its post-Budget tax strategy, it’s more important than ever to ensure your estate plan is structured correctly.

While BPR remains a vital tool for IHT planning, the Autumn Budget announcements have signalled possible future changes. These could include:

• A tightening of BPR eligibility criteria – making it harder for companies with mixed trading and investment activities to qualify
• A broader review of IHT reliefs – increasing scrutiny on tax-efficient estate planning strategies

Even if no immediate legislative changes were introduced, the ongoing review of BPR means that future adjustments could be on the horizon. Proactively reviewing your estate plan now could help you stay ahead of any potential tax increases or restrictions.

Ensure your business still qualifies for BPR

Not all businesses qualify for full BPR. If your business has changed structure, taken on investment activities, or undergone ownership adjustments, its BPR eligibility may be affected. A review can help identify and resolve any risks.

Maximise relief under the proposed rule changes

With the government assessing tax reliefs, securing your position under the proposed new rules is essential. Making adjustments now could help mitigate your IHT exposure under these proposed changes.

Future-proof your wealth for beneficiaries

Without careful estate planning, your heirs could face a significant Inheritance Tax bill of up to 40%. BPR allows for a tax-efficient transfer of business assets, but only if it’s applied correctly. Reviewing your plan ensures you maximise the benefits for your family.

Avoid common pitfalls in estate planning

Many business owners assume their estate is structured efficiently, only to later discover they are missing out on valuable tax reliefs. Common mistakes include:

• Business assets being owned in a way so that they qualify for 50% or no BPR
• Owning investment-heavy businesses that don’t qualify for BPR
• Failing to plan for succession and business continuity

At Old Mill, we work with business owners and investors to:

• Review your estate plan and assess your eligibility for BPR
• Identify risks and opportunities to maximise IHT efficiency
• Ensure your business remains compliant under current and future tax rules
• Develop succession strategies that secure your wealth for future generations

With the government actively reviewing IHT reliefs, now is the perfect time to re-evaluate your estate plan and maximise BPR in light of the proposed rule changes. A strategic review could mean the difference between a tax-efficient legacy and an unexpected tax burden.

If you’re unsure whether your estate plan is optimised for BPR, Old Mill’s expert tax advisers are here to help. Contact us today for a consultation and take control of your estate planning. Contact us here.