5 days ago
Inheritance tax changes ‘put 200,000 jobs at risk'
More than 200,000 jobs are at risk from the planned changes to inheritance tax rules for family businesses and farms, according to research.
The government's decision to change the rules for business property relief (BPR) and agricultural property relief (APR) could also wipe almost £15 billion from UK economic activity and result in a £1.9 billion tax loss, the study by Family Business UK (FBUK) said.
The government is planning to reform APR, which can give up to 100 per cent relief from inheritance tax on qualifying land, and BPR, which has the same effect on buildings operating as business premises. The latter is applicable not only to stately homes but on a range of properties.
In October, Rachel Reeves, the chancellor, announced that from April 2026 inherited agricultural assets worth more than £1 million would be liable to inheritance tax at 20 per cent — half the usual rate.
The changes, according to FBUK, could result in the loss of 208,000 jobs. Parts of Cornwall and Aberdeenshire are expected to be the worst affected, alongside Yorkshire, northern and eastern England, the Midlands and Northern Ireland. The industries expected to bear the brunt of the changes are construction, manufacturing, accommodation, hospitality and the motor industry, as well as agriculture and horticulture.
Neil Davy, the chief executive of FBUK, said: 'No industry, sector, region or parliamentary constituency will be immune. In construction, services, manufacturing, tourism, transport, agriculture and horticulture, family business owners are responding to the changes to BPR and APR by tearing up long-term plans to invest in their businesses, their employees and the communities in which they are based.
'While parts of government are looking at how to boost regional growth and create opportunities in every sector of the economy, this research shows how changes to BPR and APR will achieve the exact opposite.'
The research, which involved 4,174 businesses and farms, showed that for family businesses affected by the change to BPR, investment is likely to fall the most across Yorkshire & the Humber, as well as the East of England, by 17 per cent. Job losses would be greatest in parts of Scotland, the North West and North East of England.
