The agricultural inheritance tax changes that came into effect on 6 April 2026 have reshaped succession planning for farming families across the UK. For many farmers in Somerset and Devon, where farms are often family-owned and passed down through generations, understanding the new rules is essential to protecting both the business and the family legacy.
While not every farm will be affected, those with valuable agricultural land or farming businesses should not assume they are exempt. Taking advice now could make a significant difference to future inheritance tax liabilities.
What has changed with agricultural inheritance tax?
For many years, Agricultural Property Relief (APR) and Business Property Relief (BPR) allowed qualifying farming assets to be passed on free from inheritance tax in many cases. However, the rules are now more restrictive – even after concessions made by the government following widespread protests by farmers in response to the original plan for change.
From 6 April 2026, the first £2.5 million of qualifying agricultural and business property can still benefit from 100% relief. Any qualifying assets above this receive only 50% relief, resulting in an effective inheritance tax rate of 20% on the excess value. The £2.5 million allowance applies across both APR and BPR.
These changes to agricultural inheritance tax mean that larger farming businesses, particularly those with substantial land values, may now face inheritance tax bills that would previously have been avoided.
What does this mean for farmers?
Every farming business is different, and the impact of the agriculture inheritance tax changes will depend on factors including the value of the farm, ownership structure, business assets and succession plans.
Many family farms in Somerset and Devon have seen land values increase significantly over recent decades. Although this reflects the value of the business on paper, it does not necessarily mean the farm generates enough income to comfortably meet this level of inheritance tax.
The good news is that other new Agricultural Property Relief and Business Property Relief concessions, such as spousal relief, may still help ease inheritance tax pressure where the right planning is in place. The rules are undoubtedly more restrictive, but careful planning and legal advice can help many farming families make the most of the reliefs that remain available.
Without proper planning, however, families may face difficult decisions when passing the farm to the next generation, including selling land or borrowing to fund a tax bill. That is why reviewing your succession plans has become more important than ever.
What can farmers do now?
The new rules mean that farming families should review how their land, buildings and business assets are owned and how they intend to transfer them. Steps that farmers can take to protect their businesses and prepare for the future include:
- Reviewing the current ownership structure of the farm.
- Updating wills to reflect the new inheritance tax rules.
- Reviewing partnership agreements and business arrangements.
- Considering lifetime gifting where appropriate.
- Checking which assets qualify for Agricultural Property Relief or Business Property Relief.
- Preparing a long-term succession plan for the next generation.
None of these decisions should be made without professional advice. Tax, property and legal issues are complex and closely linked, and every farming family’s circumstances are different.
A solicitor experienced in agricultural law can help review your estate, identify potential risks and help put an effective succession plan in place. Seeking legal advice early can help preserve family relationships, maximise the reliefs that remain available and give future generations the best possible chance of continuing the farming business.
Agricultural inheritance tax changes 2026: FAQs
What is the new Agricultural Property Relief allowance?
The first £2.5 million of qualifying Agricultural Property Relief and Business Property Relief assets receives 100% relief. Assets above this threshold generally qualify for only 50% relief.
Will every farm have to pay inheritance tax?
No. Whether inheritance tax is payable depends on the value of the estate, ownership arrangements and the availability of tax reliefs.
Should farmers in Somerset and Devon do anything differently?
The legal rules are the same across England, but many farms in Somerset and Devon have high-value agricultural land and long-established family ownership, making it especially important to review succession plans sooner rather than later.
Should farmers seek legal advice?
Yes. Even if you believe your farm may not be affected, reviewing your succession plans, wills and business structure with specialist legal advisers can help ensure your family and business are prepared for the new rules.
To chat with an agricultural law specialist about your situation, get in touch with Amicus Law.
