APR & Woodlands Relief - Latest Changes Explored

Introduction

Agricultural Property Relief (‘APR’) has been extended to include ‘farming for the environment’ from April 2025, but the lack of full guidance on farming for the environment makes this complex. APR is to be reduced to 50% from April 2026 after £2.5million allowance.

The 50% reduction is also subject to the £2.5 million transferable spouse allowance at 100%. This places the need for 100% APR and BPR where possible so tenancies which only achieve 50% APR are back under the spotlight. Also, with Business Property Relief (‘BPR’) reduced to 50%, the focus on Woodlands Relief as an inheritance protection has become more heightened and the accounts must identify ownership and occupation of all woodland.

APR and Woodlands Relief will be restricted to the UK. The working party reviewing farming for the environment have still to produce their report so it is difficult to know other advantages for woodlands.

Woodlands Relief is a deferral relief and where possible APR and BPR have benefits subject to restriction to 50% above £2.5million.

All of these strands must be pulled together for farm succession planning.

What You Will Learn

This live and interactive course will cover the following:

• The announcement of 23 December 2025 - is it a “U-turn”?
• The Environmental Land Management Schemes (‘ELMs’) that qualify for APR
• The impact of woodlands on the farmhouse and APR
• APR and Woodlands Relief restricted to the UK
• Woodlands Relief comes to the forefront with the drop in APR and BPR to 50% subject to the £2.5 million allowance and spouse transfer allowance
• Woodlands - can still qualify for APR and BPR at 50% or 100%
• The £2.5 million allowance of 100% APR and BPR with spousal puts agricultural tenancies under the spotlight
• Woodlands qualify for APR provided they are ancillary to agricultural operation
• Woodlands qualify for BPR provided used commercially
• Woodlands had been forgotten about due to low value but value has increased as has price - value of softwood and hardwood must be identified
• Woodlands can be more commercial/profitable in current market and often need thinning. Income must be shown
• SDLT mixed use cases of How Development and Guerlain-Desai - lots to learn regarding use of woodland and how it needs to be commercial
• Agricultural tenancies must be reviewed
• APR is restricted to agricultural value (s.115(3))
• The importance of valuations to ascertain the value of the 100% and the agricultural restriction
• BPR does have the market value advantage but what of the risk of 0% BPR
• Agriculture is safe as is provided it qualifies therefore - what is and what is not farming?

Recording of live sessions: Soon after the Learn Live session has taken place you will be able to go back and access the recording - should you wish to revisit the material discussed.