The importance of share and asset valuations for UK tax purposes in connection with the changes to Inheritance Tax reliefs from 6 April 2026
Significant changes to the availability of Agricultural Property Relief (APR) and Business Property Relief (BPR) for Inheritance Tax (IHT) are due to take effect from 6th April 2026.
Certain conditions need to be fulfilled for the reliefs to be available, which are reviewed by HMRC’s Shares and Assets Valuation (SAV) office on submissions. If confirmed to be available, APR and BPR can hugely mitigate values when calculating IHT liabilities.
With APR and BPR currently available on 100% of value of the property, they can significantly reduce, and in some cases remove, IHT liabilities. This applies when a person dies, gifts assets to another person or a trust during their lifetime, and when a trust is subject to a 10-year anniversary charge.
Major changes to the reliefs are however coming in from 6th April 2026.
From that date APR and BPR at 100% will be capped at the first £1 million of combined agricultural and business property. The value of assets above that limit will then qualify for relief at 50% rather than the current 100%.
Shares not listed on a recognised stock exchange, for example those on the Alternative Investment Market, will also qualify for BPR at 50% instead of the current 100%.
Those potentially affected by the changes may wish to review their existing estate planning with their tax advisers. Lifetime transfers into trust may now be more attractive, with both the £1 million allowance and £325,000 individual exemption from Inheritance Tax available. Those potentially affected may want to consider acting before 6th April 2026 in order to mitigate possible future additional liability to IHT.
It can be reasonably expected that SAV will need to consider valuations—and the availability of APR and BPR—in far more cases than before, as these reliefs are no longer likely to cover the full amounts involved. In light of this increased scrutiny, the robustness of submissions to SAV and the subsequent negotiations will become significantly more complex and involved, making the appointment of a suitably experienced valuer even more essential.
How can Parmentier Arthur help?
At Parmentier Arthur, our senior team offers well over 100 years of combined experience—both within HMRC and in negotiating with HMRC—on issues relevant to companies of all sizes. This depth of expertise has recently been strengthened by the appointment of Steve Thomas, one of the most senior officials to leave SAV in recent years.
The changes taking effect from April 2026 will bring the position for trading businesses and farms much closer to that of family investment companies and property investment companies, which do not benefit from BPR. We have advised a significant number of investment companies on valuations for Inheritance Tax purposes in recent years, giving us extensive practical insight into the challenges these changes will create.
Please do not hesitate to contact Parmentier Arthur for an initial conversation.