Inheritance tax reliefs threshold to rise to £2.5m for farmers and businesses

Today (23 December), the government announced that the Agricultural and Business Property Reliefs threshold will rise from £1m to £2.5m when introduced in April 2026.

This means spouses or civil partners can pass on up to £5m in qualifying agricultural or business assets before paying Inheritance Tax, in addition to existing allowances.

The change will be included in the Finance Bill in January and apply from 6 April 2026.

Raising the threshold will significantly reduce the number of farms and business owners facing higher inheritance tax bills, ensuring only the largest estates are affected, but it remains critical to take advice, in particular to know the valuations of agricultural and business assets, and to plan based on the widened limits.

Inheritance tax reliefs threshold to rise to £2.5m for farmers and businesses – GOV.UK

If you’d like to understand what this means for your farm or business and how to plan effectively – get in touch.