Forty per cent of farms at risk due to inheritance tax reforms

Four in ten UK farms could go out of business in the next five years increasing to 56% by 2035 according to a new study of 2 000 British farmers on the impact of the government’s changes to inheritance tax.

The research commissioned by finance and mortgage advisory firm Ashbridge Partners finds that one in ten farmers say they will face an IHT bill of over £1m due to the inheritance tax hike with more than a third (31%) expecting to pay over £500 000.

The average farm business income was £86 000 across all farm types in Great Britain in 2022-23 according to figures from DEFRA with 17% failing to make a positive FBI that year and only 41% making over £50 000. At the average income level it would take inheritors 11 to 12...