April 2026 Changes to Business and Agricultural Property Relief Explained

Agricultural Property Relief (APR) and Business Property Relief (BPR) have always been essential tool for helping farming families and rural business owners pass assets onto the next generation .

Changes to these important inheritance tax reliefs were first announced during the Autumn 2024 Budget. Since then, following pushback from the farming sector and businesses,  these proposed reforms have now been revised.

On the 23^rd December 2025 the Government announced further APR/BPR changes which will come into effect on 6 April 2026.

At Hibberts Solicitors, our team of agricultural solicitors provide farming businesses across Cheshire and Shropshire with legal advice on estate and succession planning, diversification, inheritance tax, and much more. In this article, we explain what changes are coming into effect this April, how this will affect farming families, and what steps you can take to prepare.

How are APR and BPR changing in April 2026?

Under the current rules, there is no cap on the value of qualifying agricultural or business property that can benefit from 100% inheritance tax relief. This allows farming families to pass down large agricultural estates or business interests to their families without incurring inheritance tax.

From 6th April 2026, the following changes to agricultural property relief and business property relief will apply:

• 100% APR and BPR will only apply to the first £2.5 million of qualifying agricultural and business assets.
• The £2.5 million cap will apply to both individuals and trusts.
• Any qualifying assets above the £2.5 million cap will receive 50% inheritance tax, bringing the tax rate down to 20%.
• This allowance will refresh every seven years for lifetime gifts and every ten years for trusts.
• Any unused allowance can be transferred between spouses or civil partners, even if the first death occurred before 6 April 2026.

Under these new rules, couples can potentially pass on up to £5 million of qualifying agricultural or business assets with full inheritance tax relief.

Why are APR and BPR so important to farming businesses?

Farming businesses are often described as being asset-rich but cash-poor. Farming families may own high-value land and property, but their income is often modest or unpredictable.

Because of this, APR and BPR have always played an important role in helping farming families to keep land in the family. By making succession more financially viable, these reliefs protect cash flow, helping farming families to avoid forced sales of land or business assets.

Timeline of changes to business property relief and agricultural property relief

The latest version of the APR and BPR reform is more generous than previous iterations. It comes as a result of extensive lobbying from farming organisations like the CLA and NFU.

Let’s take a quick look at a timeline of how the reform has evolved.

• Autumn 2024 Budget: The government first proposed capping 100% APR and BPR at £1 million.
• Autumn 2025 Budget: A year later, it was confirmed that the allowance would be transferable between spouses and civil partners.
• 23 December 2025: Shortly afterwards, the cap was increased from £1 million to £2.5 million per person and also extended to trusts.
• 6 April 2026: The new BPR and APR changes 2026 are due to come into force.

 The Treasury has now confirmed that the government will introduce legislation in the Finance Bill 2025/2026 to amend the Inheritance Act 1984 with effect from 6 April 2026.

What steps should farmers take to prepare for the new agricultural property relief changes?

Farming families and agricultural landowners should seek professional legal advice ahead of the changes to APR and BPR to understand how the new rules may affect them.

The following steps can help you prepare for the changes:

Understand how the new IHT rules will affect you: Before making any changes to your business or legal arrangements, you should determine if and how the new rules will apply to your estate. To do so, you’ll need to calculate the likely value of your assets.

Review your estate planning and wills: Unless reviewed very recently, your existing will or estate plan is likely to have been drafted on the assumption that full APR and BPR would apply to the entire value of your qualifying assets. If, after 6 April 2026, this will no longer be the case, you will need to review the way your business is structured and how land and assets are owned to ensure everything is still set up as tax-efficiently as possible.

Consider succession planning: Succession planning can also help to support the long-term viability of a farm. An agricultural solicitor can help you to plan who will take over the farm, how the business will continue to operate, and how family members will be provided for long-term, while also managing tax efficiency.

Speak to Hibberts Solicitors’ team of expert agricultural solicitors

Need further help understanding how the changes to APR and BPR will apply to your estate? Hibberts Solicitors can provide expert legal advice on a wide range of agricultural law matters. Our team of specialist agricultural law solicitors are here to help you ensure that your farming business is set up in the most tax-efficient way possible to protect both your business and your family’s futures. To learn more, give our team a call on 01270 624 225 or email us at enquiries@hibberts.com