Another difficult day for UK farming – Autumn Budget 2024

The proposed changes to Agricultural Property Relief (APR) and Business Property Relief (BPR) are likely to have an impact on most rural businesses, both in an operational context and with regard to succession planning.

With effect from 6 April 2026, both reliefs will have a combined limit of £1 million, with a 50% relief for values over this level. Given that this value will include hope values, regardless of whether you ever plan to develop or sell, potential goodwill on relevant diversified activities, and the value of certain Agricultural Holdings Act tenancies, to highlight but a few, the potential exposure could impact smaller enterprises more than you may have anticipated.

Add to this the impact of increased labour costs and associated changes to National Insurance contributions, together with the demise of Basic Payment Scheme subsidies, and the commercial issues surrounding UK farming have been significantly increased.

On a positive note, rural businesses have, and will no doubt continue to, adapt imaginatively to the burdens of taxation and legislation.

In common with many major tax changes, it seems likely that revenue streams will be lower than anticipated and unexpected behaviours may well result in a reduced appetite to drive business development.

Obviously, there are mitigation measures to be considered, and these will be bespoke to the individuals and businesses concerned. Like you, our specialist rural team will be reflecting on the Budget over the next few days, including any subsequent announcements that may be made, and will be in touch with our clients to chat through implications and options.

If the Autumn Budget has raised any questions for you, book your place on our question time webinar this Friday at 9:30am. Alternatively, if you would like any further information or guidance on this topic, get in touch with your usual Kreston Reeves contact or contact us here.