Shropshire Farming Talk: Environmental services and inheritance tax, a step closer to clarity for landowners and farmers
Last month in the Spring Budget it was confirmed that the existing scope of Agricultural Property Relief (APR) for inheritance tax will be extended from 6 April 2025 to land managed under an environmental agreement, and APR will not be restricted to tenancies of at least eight years in term.
The announcement was a major step towards clarifying the tax treatment of environmental services for inheritance tax purposes, but the devil will be held in the detail, which we await with interest.
Meanwhile it would be prudent to proceed with caution for two reasons.
First, we don’t yet have the ‘black letter law’ or statute to provide the framework of APR in the context of eco-system services and second, there is no case law providing evidence of how the legislation is being interpreted to guide us in terms of its application in practice.
