Family Farms In Northern Ireland To Be Hit Hard By Inheritance Tax Changes

The Chartered Accountants Ireland’s Northern Ireland tax committee has warned that family farms in NI will be hit particularly hard by the upcoming inheritance tax changes. It was in the infamous autumn budget that Chancellor Rachel Reeves announced these changes that have been heavily criticised by farmers and their various organisations up and down the UK.

In the budget Reeves announced that there would be restrictions to agricultural property relief (APR) and business property relief (BPR) for inheritance tax. Here are the changes as copied from an article on the Agriland website. It says:

‘The UK Chancellor confirmed last October that from April 2026, 100% relief for APR and BPR will be limited to the first £1 million of combined agricultural and business property with any value above this receiving relief at 50%, effectively resulting in an IHT liability of 20%.’

Farms Concerned They Will Have To Sell Off Land

Many family farms have said that they would either have to sell off part of their farm or sell up completely if these tax changes came into effect. Farming is such an important part the landscape in Northern Ireland, with approximately 77% of all land here involved with farming, which relates to a total of 1.35 million hectares being used for agriculture. There are over 26,000 farming businesses and more than 51,000 people work in this sector, and so it is a really important cog in the overall economy.

Changes Will Starve Businesses And Economy Of Much Needed Investment

Here is what Cróna Clohisey, director of members and advocacy at Chartered Accountants Ireland, is quoted as saying on the inheritance tax changes, as quoted from the same Agriland website:

“These proposals, which could result in significant tax liabilities, are already causing deep problems and distress for family businesses and farms across the UK, but we are concerned about the particular impact for family-owned business and farms in Northern Ireland.

“These changes will starve businesses and the economy of much-needed investment and could cause forced, premature business sales and the loss of jobs, lives and livelihoods. In the current uncertain geopolitical environment, the government needs to do whatever it can to protect genuine business and farming activity in the UK,” Clohisey said.

She also said the organisation has urged the UK government to “postpone the changes and engage with stakeholders to reframe this policy change in a way that it is more effectively targeted”.

Will these words be heeded? The UK government is already under huge pressure to balance the books, having undertaken to spend more money on defence over the next few years. They also have to contend with the issue of Trump’s tariffs which may blow a hole in any chance of economic growth in the foreseeable future. So we suspect it is not totally out of the question but very unlikely.