Recent UK Government changes to inheritance tax will have significant implications for Scottish businesses and farming families planning for succession.
Confirmed in early January following a December 23 announcement, the inheritance tax allowance for qualifying agricultural and business property will rise from £1m to £2.5m from April 6, 2026.
Crucially, amendments to the Finance Bill extend the enhanced relief to property held in trust, aligning trust allowances with those available on personal transfers.
For many Scottish operations, the change could significantly reduce – or remove altogether – exposure to inheritance tax, particularly where family ownership and trust structures are combined.
With careful planning, married couples or civil partners may be able to structure £10m or more outside the scope of IHT.
"Given the timing, this change may have slipped under the radar for some, yet the implications for succession planning are significant and merit early, specialist advice."
