Farmers across Gloucestershire urged to act over tax reforms

Major changes to Agricultural Property Relief (APR) and Business Property Relief (BPR) came into force on April 6 and rural property experts are urging farming families across Gloucestershire to ensure their succession plans are clear, up to date and able to withstand the impacts of the new regime.

For the first time, a £2.5 million cap will apply to qualifying agricultural and business assets eligible for 100% inheritance tax relief, with 50% relief available above that threshold.

The allowance is transferable between spouses or civil partners, meaning couples can pass on up to £5 million tax free. While this reduces exposure for many family farms, larger or more diversified farms may now face new liabilities.

Hannah Wray, a rural valuation surveyor for Savills Rural Consultancy in the Central region, notes that a High Court judicial review is currently examining whether the Government should have undertaken wider consultation before introducing these reforms.

Hannah said: “It’s important families are aware that this legal challenge is ongoing. Although the hearing has concluded and we await a decision, it focuses on the consultation process. Depending on the outcome, it could influence how and when the reforms take effect – but for now, the industry continues to prepare based on the legislation as it stands.”

She added that the financial implications of the reforms shouldn’t be underestimated. Recent Savills research indicates that around 73% of the post-tax profit generated over an entire decade would be required just to meet the inheritance tax liability on an 800-acre arable farm under the new rules.

“That finding really brings the scale of the challenge into sharp focus,” Hannah said. “For many families, it reinforces why structured planning and early action are essential if they’re to preserve the long-term viability of the business.”

The uncertainty, combined with the scale of the upcoming changes, means many families are reviewing business structures, asset ownership and long-term plans to safeguard resilience.

“Succession remains one of the most challenging issues for family-run farms,” Hannah added.

Established custodians often grapple with the emotional and practical realities of handing over responsibility, while younger generations – often returning with fresh skills and broader experience – can feel their expectations are overlooked. Aligning these perspectives is becoming increasingly important as the demands of modern farming evolve.

Hannah emphasises that both generations bring value: “The older generation offers continuity and deep knowledge, while the next generation brings the mindset needed to adapt. When both viewpoints are recognised, conversations become far more productive.”

Clear timelines also help successors prepare through training, skills development and personal decision-making. “Ambiguity can be incredibly stressful,” she said. “With clarity, younger family members return better equipped, more commercially aware and more confident in how they can contribute.”

Introducing new ideas or technologies can be sensitive, particularly where routines and traditions run deep. A well-structured, well-communicated handover plan helps reassure both sides and reduces friction.

Advisors now play a central role in helping families navigate the tax, legal and operational implications of the reforms. In some cases, specialist input may be needed to support smoother transitions.

“Open, honest communication – supported by trusted advisors – is the foundation of effective succession,” Hannah said. “Clear plans reduce uncertainty and stress, give younger family members the confidence to engage fully, and help protect family assets for future generations.”

With the new tax reforms and generational change accelerating across the sector, now is the time for families to act. For some, this may mean restructuring or gifting; for others, incorporating the business or redistributing responsibilities. Whatever the route, proactive planning today will help secure the future resilience and prosperity of family farms.