Government Boosts APR and BPR Relief to £2.5m Under Inheritance Tax Reforms

On 23 December 2025, the UK Government confirmed important changes to the Agricultural Property Relief (APR) and Business Property Relief (BPR) as part of their ongoing inheritance tax reforms.

Under the updated measures, due to come into effect from 6 April 2026:

• The 100% relief threshold for APR and BPR will be increased from £1 million to £2.5 million per individual.
• This means qualifying agricultural and business assets up to £2.5 million will continue to receive full inheritance tax relief.
• Any qualifying value above this level will receive 50% relief, effectively reducing the inheritance tax rate on excess assets.
• Thanks to earlier budget reforms, unused relief allowances can be transferred between spouses or civil partners, allowing couples to pass on up to £5 million in qualifying assets tax-free (or up to £6.3 million when utilising available nil rate bands).

TLT will be reviewing the draft legislation and will provide more details shortly.  In the meantime, the government press release can be found here:

Inheritance tax reliefs threshold to rise to £2.5m for farmers and businesses - GOV.UK