Policy paper

Reforms to agricultural property relief and business property relief 

This measure reforms agricultural property relief and business property relief from Inheritance Tax.

• From: HM Revenue & Customs
• Published: 21 July 2025

Documents

Agricultural property relief and business property relief reforms

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Draft legislation

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Draft legislation (accessible version)

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Explanatory note

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Details

This measure makes changes to the reliefs so that from 6 April 2026: 

• a new £1 million allowance will apply to the combined value of property in an estate qualifying for 100% business property relief or 100% agricultural property relief or both — relief at the lower rate of 50% will apply to the value of any qualifying relievable property over £1 million
• the rate of business property relief available will be reduced from 100% to 50% in all circumstances for shares admitted to trading on recognised stock exchanges designated as ‘not listed’
• the option to pay Inheritance Tax by equal annual instalments over 10 years interest-free will be extended to all property which is eligible for agricultural property relief or business property relief

Published 21 July 2025