Wayne Horrex, senior manager at Ensors, part of Azets, reviews the reforms to Business Property Relief and Agricultural Property Relief.
Most people will be familiar with the reforms to Agricultural Property Relief (APR) and Business Property Relief (BPR) that were announced in the 2024 budget.
These reforms came into effect on April 6, 2026, however, there have been a few changes to what was originally announced – so where are we now?
Wayne Horrex, senior manager at Ensors, part of Azets (Image: Ensors)
At the November 2025 budget, the chancellor announced that the 100% APR/BPR allowance for qualifying assets would be transferable between spouses on death. This was followed in December 2025 by a further announcement to extend the allowance from £1 million to £2.5 million.
Together, these announcements can extend the potential value of assets qualifying for 100% relief to £5 million per couple.
Importance of valuations
Historically, due to land, buildings, machinery and stock qualifying for 100% APR or BPR, a professional valuation of these assets hasn’t strictly been necessary, with HMRC generally accepting balance sheet values rather than market values.
As a result of the reforms, and consequently these assets not necessarily benefitting from 100% relief anymore, there will be a need for a full valuation of the farm and business to provide accurate market values of these assets. This should ideally be undertaken as soon as possible after death.
Valuations will also be important for trustees of relevant property trusts that hold APR and BPR qualifying property, as the trustee’s allowance is set by the initial value of assets when they enter the trust.
Final thoughts
Following the reforms to APR and BPR it is important to undertake inheritance tax planning as early as possible. Succession planning takes time and if you are looking to give assets away then this needs to be done with sufficient time to survive seven years for the transfer to fall out of your estate.
It should also be noted that inheritance tax planning should not be considered in isolation as there will inevitably be impacts on other taxes. It is, therefore, essential to talk with your accountant before any decisions are made.
For more information, visit ensors.co.uk
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