Work out how to apportion Agricultural and Business Relief for Inheritance Tax
Use this tool to work out how to apportion the £2.5 million allowance across property that qualifies for 100% agricultural relief or 100% business relief.
For deaths on or after 6 April 2026, qualifying agricultural or business property can receive 100% relief up to a maximum of £2.5 million.
This £2.5 million allowance includes:
- qualifying property in the estate
- gifts made on or after 30 October 2024 (if the person dies within 7 years)
Any unused allowance transferred from a predeceased spouse or civil partner could make this allowance up to £5 million.
Once the £2.5 million allowance is used up, the rate of relief is 50%.
Some property does not use up the £2.5 million allowance and can only receive 50% relief. This includes shares traded on markets that do not meet HMRC’s definition of ‘listed’, such as the Alternative Investment Market.
What qualifies for 100% relief
Property that qualifies for 100% relief includes:
- agricultural property such as farmland, farm buildings and farmhouses
- business property such as trading businesses
When to use this tool
Use this tool if the estate has gifts and assets that qualify for 100% agricultural relief or 100% business relief.
You can use this tool for estates with up to 8 agricultural and 8 business property assets.
Larger or more complex estates may require professional advice.
You do not need to use this tool if the value of gifts and assets is below the total allowance of £2.5 million and any unused allowance transferred from a predeceased spouse or civil partner.
What the tool will do
The tool will:
- calculate how much of the £2.5 million allowance has been used on lifetime gifts
- share the remaining allowance across assets in the estate
- provide a breakdown of 100% and 50% relief for each asset
- direct you to the Inheritance Tax forms you need to send HMRC
What the tool will not do
The tool will not:
- calculate Inheritance Tax
- notify HMRC of the estate’s value or a claim to transfer allowance
- apply other Inheritance Tax exemptions
- tell you if an asset qualifies for Agricultural Relief or Business Relief
- tell you if an estate is an excepted estate
You can estimate an estate’s value.
Before you start
Before you work out the allowance, first deduct exemptions for:
- spouses or civil partners
- gifts to charities
For each lifetime gift of qualifying property from 30 October 2024 onwards, you’ll need to know the:
- date of the gift
- value of the gift which qualifies for Agricultural Relief
- value of the gift which qualifies for Business Relief
- name of the recipient (individual or trust)
For assets held at death, you’ll need to know:
- the asset type (for example, farmland or business shares)
- the value qualifying for Agricultural Relief
- the value qualifying for Business Relief
- the name of the owner (the estate, joint owners or a trust the person is treated as owning)
- any gift with reservation
- any assets which only qualify for 50% relief
Work out Agricultural and Business Relief
The tool will apply the allowance in this order:
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Lifetime gifts of qualifying property use the 100% relief first, from the oldest gift to the newest.
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The tool then shares any remaining allowance across all assets that qualify for 100% Agricultural Relief or Business Relief. The allowance must be divided proportionally across the estate — you cannot apply it all to a single asset.
If property could qualify for both Agricultural and Business Relief, the tool applies Agricultural Relief in preference to, and instead of, Business Relief.
If the 100% allowance is fully used, any further qualifying amount over £2.5 million receives 50% relief.
Your answers will not be saved. If you close the tool without finishing the questions, you will need to start again.
What to do next
Enter the 100% and 50% relief amounts from the tool in the relevant IHT forms.
The apportionment of relief will change if any of the values change after you make the calculation, including after you report the value of an estate.