UK raises farm inheritance tax threshold to £2.5M, doubling relief for family farms.

The UK government has reversed its 2024 plan to tax inherited farmland over £1 million, raising the inheritance tax threshold for agricultural property relief to £2.5 million effective April 2026. This change allows spouses or civil partners to pass on up to £5 million in qualifying farm or business assets tax-free, with 50% relief on amounts above that. The move follows widespread protests, including tractor demonstrations, and aims to protect family farms from financial strain. Officials say it will spare most estates from significant tax bills, with 85% of agricultural property relief claimants expected to pay no additional inheritance tax. The policy change reflects a shift in response to farmer concerns and is part of broader efforts to support rural livelihoods and sustainable farming.