Q&A: Budget changes to business property relief

The government announced changes to business property relief (BPR) – and agricultural property relief (APR) – due to take effect from 6 April 2026.

The reforms have been described as ‘potentially seismic’ and affected stakeholders in the business and farming community continue to raise concerns about the impact of the new rules.

APR and BPR in their current form reduce the value of relevant business or agricultural property when calculating the inheritance tax (IHT) due either on death or on transfers into trust at a rate of 100% or 50%. There is no limit on the amount of value which can be reduced under the current rules.

What are the changes?

Under the government’s proposals from 6 April 2026 onwards in addition to existing allowances and exemptions the 100% rate of relief of APR and BPR will continue only for the first £1m of...