Action Required: A Possible Response To IHT Changes Must Be Completed Before 6 April

The 2024 Budget Statement included some significant changes to Agricultural Property Relief (APR) and Business Property Relief (BPR). Several further announcements followed, some of which amended previous ones. So let's start by re-capping the current position and how it will change from 6 April this year.

Currently, APR and BPR mean that some properties and assets are not included when calculating an Inheritance Tax bill on the owner's death. In some other cases, 50% relief applies – but in many, 100% relief can be claimed. There is no upper limit on the amount that can be exempt under these reliefs.

From 6 April this year, however, there will be a limit on these exemptions: £2.5 million per person. This will be transferrable between spouses and civil partners, so the limit is £5 million per couple on the second death. Inheritance Tax is payable on the death of the owner of the assets or, if assets are put in a trust, where they exceed this limit.