• Contact us
  • About us
  • Digital edition
  • Online archive
Saturday, July 5, 2025
Cumberland and Westmorland Herald
  • News
    Man fined £100 for using cashpoint in car park

    Man fined £100 for using cashpoint in car park

    Honour for man who devoted his life to Greystoke

    Honour for man who devoted his life to Greystoke

    Sheep breeder’s successful debut at Royal Highland Show

    Sheep breeder’s successful debut at Royal Highland Show

    Global engineering firm Babcock supports Eden charity

    Global engineering firm Babcock supports Eden charity

    Penrith Lions mark 50 years of serving community

    Penrith Lions mark 50 years of serving community

    £8,000 for two new nature reserve projects

    £8,000 for two new nature reserve projects

    Fun day in Penrith to celebrate community spirit

    Fun day in Penrith to celebrate community spirit

    Arrests after shoplifting incidents in Penrith

    Arrests after shoplifting incidents in Penrith

    Anti-social residents move out after threatened with police order

    Anti-social residents move out after threatened with police order

  • Sport
    Penrith skipper Nicky Burns calls on team to keep winning

    Penrith skipper Nicky Burns calls on team to keep winning

    £100,000 target for new changing rooms extension

    £100,000 target for new changing rooms extension

    Medal success for Upper Eden tug-of-war team

    Medal success for Upper Eden tug-of-war team

    Eden man competes in Hyrox World Games

    Eden man competes in Hyrox World Games

    Double national triumph for Stuart Robinson

    Double national triumph for Stuart Robinson

    Patterdale’s Eden Eagles make history

    Patterdale’s Eden Eagles make history

    Penrith teen crowned British vault champion

    Penrith teen crowned British vault champion

    Penrith gymnasts represent North of England in finals

    Penrith gymnasts represent North of England in finals

    New boss revealed for Penrith AFC

    New boss revealed for Penrith AFC

  • Obituaries
  • Nostalgia
  • Online archive
  • Buy Photos
  • Buy your paper
  • North Lakes Living
No Result
View All Result
Cumberland and Westmorland Herald
  • News
    Man fined £100 for using cashpoint in car park

    Man fined £100 for using cashpoint in car park

    Honour for man who devoted his life to Greystoke

    Honour for man who devoted his life to Greystoke

    Sheep breeder’s successful debut at Royal Highland Show

    Sheep breeder’s successful debut at Royal Highland Show

    Global engineering firm Babcock supports Eden charity

    Global engineering firm Babcock supports Eden charity

    Penrith Lions mark 50 years of serving community

    Penrith Lions mark 50 years of serving community

    £8,000 for two new nature reserve projects

    £8,000 for two new nature reserve projects

    Fun day in Penrith to celebrate community spirit

    Fun day in Penrith to celebrate community spirit

    Arrests after shoplifting incidents in Penrith

    Arrests after shoplifting incidents in Penrith

    Anti-social residents move out after threatened with police order

    Anti-social residents move out after threatened with police order

  • Sport
    Penrith skipper Nicky Burns calls on team to keep winning

    Penrith skipper Nicky Burns calls on team to keep winning

    £100,000 target for new changing rooms extension

    £100,000 target for new changing rooms extension

    Medal success for Upper Eden tug-of-war team

    Medal success for Upper Eden tug-of-war team

    Eden man competes in Hyrox World Games

    Eden man competes in Hyrox World Games

    Double national triumph for Stuart Robinson

    Double national triumph for Stuart Robinson

    Patterdale’s Eden Eagles make history

    Patterdale’s Eden Eagles make history

    Penrith teen crowned British vault champion

    Penrith teen crowned British vault champion

    Penrith gymnasts represent North of England in finals

    Penrith gymnasts represent North of England in finals

    New boss revealed for Penrith AFC

    New boss revealed for Penrith AFC

  • Obituaries
  • Nostalgia
  • Online archive
  • Buy Photos
  • Buy your paper
  • North Lakes Living
No Result
View All Result
Cumberland and Westmorland Herald
No Result
View All Result
Home Expert advice
This article appears as part of a paid partnership with Armstrong Watson

Capital Gains Tax and Inheritance Tax on agricultural land and farms

By Dan Cozens, accounting and business services manager, Armstrong Watson

by CWH
13 November 2024
in Expert advice, Farm and Countryside
A A
Share on FacebookShare on Twitter
Dan Cozens, of Armstrong Watson

Selling or transferring agricultural land and farms can have significant tax implications, particularly concerning Capital Gains Tax (CGT) and Inheritance Tax (IHT).

Given the changes announced in the Autumn Budget 2024, it is important to consider the current rates and the implication of future increases.

Capital Gains Tax

Capital Gains Tax (CGT) is charged on the profit made from selling an asset, including agricultural land and farms.

  • Calculation: The gain is calculated as the difference between the sale price and the original purchase price, minus allowable expenses such as legal fees and improvement costs.
  • Rates: The Chancellor has brought the CGT rates for chargeable assets in line with residential property, effective for disposals made from 30 October 2024. These rates have been increased from 10% to 18% for basic rate taxpayers and from 20% to 24% for higher rate taxpayers, meaning the same rates are now applicable to both residential and non-residential properties, as well as other chargeable gains.

Exemptions and reliefs

  • Annual Exempt Amount: Each individual has an annual exempt amount which has been reduced over recent years to £3,000 in 2024/25 (£6,000 in 2023/24)
  • Business Asset Disposal Relief (BADR): This relief can reduce the CGT rate to 10% on qualifying business assets, including farms, up to a lifetime limit of £1 million. This rate will increase to 14% in 2025/26 and 18% in 2026/27. Any remaining gain will be taxed at 24% from 30 October 2024.

Inheritance Tax

Inheritance Tax (IHT) has seen one of the biggest changes following the Autumn Budget.

IHT is charged on the value of an estate passed on after death. The standard IHT rate is 40% on the value above the nil-rate band of £325,000, topped up to £500,000 if you leave your home to your children or grandchildren and your total estate is valued under £2 million.

Two reliefs are potentially available to those selling agricultural land and farms – Agricultural Property Relief (APR) and Business Property Relief (BPR). Previously this

applied to the whole value of the qualifying asset but the Autumn Budget set the combined relief cap for APR and BPR at £1 million which is due to come in from 6 April 2026.

Agricultural Property Relief

APR can still significantly reduce the IHT liability on agricultural land and buildings. It applies to agricultural property occupied for agricultural purposes. This includes land, buildings, and farmhouses proportionate in size and character to the agricultural land.

APR can provide up to 100% relief on the agricultural value of the property up to £1 million with any amount above this receiving 50% relief. To qualify, the property / land must have been owned and used for agricultural purposes for at least two years (if occupied by the owner) or seven years (if occupied by someone else).

Business Property Relief

BPR can also reduce IHT on business assets, including farms. To be eligible the farm must be a working business, not just an investment. BPR applies to both the land and buildings used in the business.

BPR can provide 100% relief on the value of the business property up to £1 million if it has been owned for at least two years before the transfer with any amount above this receiving 50% relief.

Combining APR and BPR

In some cases, it is possible to combine APR and BPR to maximise tax relief but the combined relief is restricted to £1 million. For example, APR can be applied to the agricultural parts of the property, while BPR can be applied to the business elements.

Unlike the IHT nil-rate band, any unused APR/BPR allowance will not be transferable between spouses or civil partners.

In light of the proposed changes to APR and BPR, effective succession planning has never been more crucial. Ensuring a smooth transition of your agricultural land and business assets can help maximise tax reliefs and secure the future of your family business, and the earlier planning is undertaken, the greater the chance of success.

If you would like further advice and support, please get in touch.
Call 01768 222030 or email help@armstrongwatson.co.uk

Related Posts

Sheep breeder’s successful debut at Royal Highland Show
Farm and Countryside

Sheep breeder’s successful debut at Royal Highland Show

4 July 2025
Partnership vs company: Choosing the right structure for your farming business
Expert advice

Partnership vs company: Choosing the right structure for your farming business

29 June 2025
Is outsourcing a strategic opportunity amid rising employment costs?
Expert advice

Is outsourcing a strategic opportunity amid rising employment costs?

22 June 2025
Farms focus on cashflow following SFI scheme closure
Expert advice

Farms focus on cashflow following SFI scheme closure

21 June 2025
Risks and strategies for flexible pension drawdown
Expert advice

Risks and strategies for flexible pension drawdown

15 June 2025
Carbon audit produces positive results for North Sheep host family
Farm and Countryside

Carbon audit produces positive results for North Sheep host family

13 June 2025
No Result
View All Result

Stay connected

Facebook Twitter Instagram

Most popular

Penrith skipper Nicky Burns calls on team to keep winning

Penrith skipper Nicky Burns calls on team to keep winning

4 July 2025
Honour for man who devoted his life to Greystoke

Honour for man who devoted his life to Greystoke

4 July 2025
Sheep breeder’s successful debut at Royal Highland Show

Sheep breeder’s successful debut at Royal Highland Show

4 July 2025
Penrith Lions mark 50 years of serving community

Penrith Lions mark 50 years of serving community

4 July 2025
Anti-social residents move out after threatened with police order

Anti-social residents move out after threatened with police order

3 July 2025
Memory lane – a look at the Herald’s archive photos

Memory lane – a look at the Herald’s archive photos

4 July 2025
Cumberland and Westmorland Herald Logo

33 Middlegate
Penrith
Cumbria
CA11 7SY

Phone: 01768 862313
Email: news@cwherald.com

Registered in England as Barrnon Media Limited. No: 12475190
VAT registration number: 343486488

Explore

  • News
  • Sport
  • Farming
  • Property
  • Obituaries
  • Nostalgia
  • Your view

Useful links

  • Contact us
  • Photosales
  • Online archive
  • Buy your paper
  • Digital edition
  • North Lakes Living
  • Advertise
  • About us

Follow us on

© Barrnon Media Limited 2025

Terms & Conditions / Privacy Policy / Cookie Policy

This website and its associated newspaper are members of the Independent Press Standards Organisation
Review Your Cart
0
Discount
Add Coupon Code
Subtotal
Total Installment Payments
Bundle Discount
Checkout

 
0
No Result
View All Result
  • Home
  • News
  • Sport
  • Obituaries
  • Nostalgia
  • Online archive
  • more
    • North Lakes Living
    • Buy Photos
    • Buy your paper
    • About us
    • Contact us

© 2020 Cumberland & Westmorland Herald