purposes from 2026, but as the CLA points out, this means that estates worth less than £1m today, but which still qualify for relief, will no longer do so in future, “potentially reducing the value of those estates”.
This means that the impact of the tax change is likely to be wider than just APR figures alone suggest.
However, it remains difficult to accurately estimate the impact of including BPR, as this data is not currently compiled.
Overall, it is clear that the government and farming groups have very different views on how many farms will be affected by the changes to inheritance tax.
The most reliable estimates to date suggest the figure is likely to be around 500 estates a year, although it is important to bare in mind this only reflects the number of claims made for inheritance tax relief in recent years and may not capture all of those who are potentially impacted.
Farming groups’ estimates that 70,000 farms could be impacted are not based on an annual figure and are therefore less useful when trying to engage the likely scale of the impact.
It’s important to remember that while this is clearly a controversial issue, around 75% of farms are expected to be unaffected by the changes, and the government maintains that it wants to make the inheritance tax system fairer and discourage wealthy people from investing in land solely to avoid the tax.
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