Question to the Department for Environment, Food and Rural Affairs:

To ask the Secretary of State for Environment, Food and Rural Affairs, what assessment he has made of the potential impact of inheritance tax policy on the viability and succession of family farming businesses, in light of the findings of the Farming Profitability Review.

Following the reforms to inheritance tax announced at Budget 2024, we have engaged with the farming community and businesses. Having carefully considered this feedback, we are going further to protect more farms and businesses, while maintaining the core principle that the most valuable agricultural and business assets should not receive unlimited relief.

The allowance for 100% rate of relief will be increased from £1 million to £2.5 million when it is introduced in April 2026. This means a couple will now be able to pass on up to £5 million tax-free between them, on top of existing allowances such as the nil rate band.

Raising the threshold will significantly reduce the number of farms and business owners facing higher inheritance tax bills under the reforms, ensuring only the largest estates are affected. This gets the balance right between supporting farms and businesses, fixing the public finances, and funding public services.