Welcome reprieve for farming businesses, as APR thresholds changed

Press Release

Scottish Land & Estates (SLE), the rural business organisation, welcomes the announcement by the UK government of further changes to the forthcoming reforms of agricultural property relief and business property relief from 6 April 2026. 

The announced changes mean the government is protecting the viability of more farms and businesses, while maintaining the core principle that those agricultural and business assets with the highest value should not receive unlimited relief from inheritance tax. 

The threshold for 100% relief will be increased from £1 million to £2.5 million.  This means that up to £5 million of agricultural or business assets may be passed on by a married couple to the next generation, on top of the existing allowances such as the nil rate band.   

In line with the changes to the personal relief allowance, trust relief allowance amounts will also be increased from £1m to £2.5m. 

The changes will be reflected in government amendments to the Finance Bill next month. 

Eleanor Kay, Senior Policy Adviser (Agriculture & Climate Change), for SLE said: “The government has listened carefully to the farming community, family businesses and their representatives and has made the right decision. We applaud all those who have campaigned so hard to protect the agricultural sector. This change will go a long way to ease the pressure on farmers and other family businesses which are already under considerable financial  strain. 

“We have long argued that the £1m threshold was far too low so it is reassuring that the UK government has now paid heed to the evidence and changed course. Family-run businesses are often at the forefront of producing high-quality home-grown food, while protecting habitats and providing space for nature.”

It is estimated that the amendment will see the number of rural businesses impacted by the tax fall from 375 to 185.