19th December 2024

Matthew Yates discusses new IHT caps and their impact on UK farmers in Solicitors Journal

Autumn morning view over the high weald to the south downs from Herrings lane east Sussex south east England UK

Matthew Yates

Partner, Head of Private Client

Matthew’s article was published in Solicitors Journal, 18 December 2024, and can be seen here.

Matthew Yates, Partner and joint Head of our Private Client department, discusses the new inheritance tax (IHT) caps, which have raised significant concerns among farmers.

Announced by Chancellor Rachel Reeves in the Autumn Budget, the changes will impose a £1 million limit on Agricultural Property Relief (APR) and Business Property Relief (BPR) from April 2026.

Labour’s 'Tractor Tax': The End of Family Farming?

New inheritance tax caps threaten UK farmers, sparking fears of devastating economic consequences, says Matthew Yates

It has become one of the biggest domestic stories of the year, attracting almost as many headlines as Labour’s general election victory, or the subsequent scrapping of pensioners’ winter fuel payments: the government’s plan to impose inheritance tax (IHT) on farmers. Light-heartedly dubbed the ‘tractor tax’ by the media, the consequences for those who find themselves in the government’s crosshairs are deadly serious. On 30th October, Labour’s first Chancellor in 14 years, Rachel Reeves, announced in her inaugural Budget that the government would introduce what the FT referred to as “a shock cap on inheritance tax relief for agricultural assets.”

Read the full article here: Labour’s 'Tractor Tax': The End of Family Farming? (Solicitors Journal)

Farming is complex. Genuine farmers operate their businesses in diverse ways to suit multiple conditions and circumstances. They are quite different from wealthy investors and absentee landlords who buy farmland with the primary intention of avoiding IHT.