Tax Tip 11: Agricultural Property Relief

There are two notable reliefs from IHT: Agricultural Property Relief and Business Property Relief.

APR is a 100% relief from IHT. It protects land used for farming from having to be sold by farming families in order to settle the IHT liability.

The relief applies land or pasture used to grow crops or intensively rear animals. It includes land used for growing animals and trees (as long as they are cut down and replanted as part of a 10 year cycle), and farm buildings.

There are notable exceptions to the relief and these include farm equipment and machines, derelict buildings, crops that have been harvested and livestock. It is usual however for BPR to apply to these assets as they form part of the farming business. 

Farmhouses must be considered carefully when claiming APR.  They must be of a nature and size appropriate to the farming activity. Any value over and above the agricultural value will not receive the relief. 

If you believe your estate consists of agricultural property please get in touch and we can help to ensure that APR will be available.  

 These notes have been prepared for the purpose of articles only. They should not be regarded as a substitute for taking legal advice.