Business Property Relief for Farms and Family Businesses
Written and reviewed by the Agricultural Accountants editorial team. Last reviewed 27 July 2026.
Business Property Relief is the relief that sits alongside Agricultural Property Relief and, on many farms, does more of the work. It covers the trading business rather than the bare land, which matters because a modern farm is a business with machinery, stock, contracting income and diversified enterprises, not just acres.
It was reformed in the same 2026 package as APR, and it shares the same allowance.
The 100% and 50% Categories
One hundred per cent Business Relief covers a business or an interest in a business, and shares in an unlisted company. Fifty per cent covers controlling holdings of listed shares and land, buildings or machinery owned personally but used in a business you were a partner in or controlled. GOV.UK sets out the categories in its Business Relief guidance.
For a farm run as a partnership or a company, this is usually where the value sits, and it is why how the business is structured matters as much as who owns the land.
The Two-Year Rule and Excepted Assets
The business or asset has to have been owned for at least two years before death. And relief is denied on a business that mainly deals in securities, land or investments, or on excepted assets not used mainly for the business in the two years before the transfer. A pile of cash or an investment property sitting in the farm company can be carved out of relief.
This is the trap on a diversified farm. Income from letting land for solar or wind, or a large investment holding, can be treated as investment rather than trading and put relief at risk, which is why the mix of activities needs looking at well before it matters.
Sharing the £2.5 Million Allowance With APR
Since 6 April 2026 the 100% rate of both APR and BPR is capped at a combined £2.5 million per person, with 50% relief above. So the two reliefs no longer stack without limit: they draw on one allowance. Our guide to farm inheritance tax covers the reform in full, and the planning is an engagement in our succession service.
The reform is in the Finance Act 2026. Because APR and BPR now share a ceiling, the order in which reliefs apply and how the estate is arranged can change the bill.