UK Government Raises Threshold for Taxed Inherited Farmland Amid Farmer Protests
The UK government has increased the threshold for taxed inherited farmland from £1 million to £2.5 million. This change reverses the original plan which proposed a 20% tax on inherited agricultural assets above £1 million starting from April 2026.
The adjustment follows protests from farmers and concerns raised by some Labour backbenchers. Environment Secretary Emma Reynolds stated that the changes protect more ordinary family farms while ensuring larger estates contribute more.
The National Farmers' Union president Tom Bradshaw welcomed the increase, noting it reduces risk for many family farms. Similarly, Country Land and Business Association president Gavin Lane said the government recognised flaws in its original proposal and changed course accordingly.
However, the announcement still poses a risk to some family businesses, especially those with machinery and land combined above the new threshold, due to narrow profit margins and ongoing tax burdens.
In Parliament, around 12 backbenchers abstained from the vote. Markus Campbell-Savours voted against the measure, was subsequently suspended, and now sits as an independent.
