The family farm tax is set to hit one in 10 farmers with an IHT bill of over £1m, with a third expecting to pay at least £500,000, revealed a survey of 2,000 British farmers commissioned by finance and mortgage advisory firm Ashridge Partners.

The change to agricultural property relief (APR) from 6 April 2026, will see 100% relief from IHT restricted to the first £1m of combined agricultural and business property. Above this amount, farmers will pay up to 20% IHT, paid in instalments over 10 years, interest free, and a couple can pass on up to £3m free of inheritance tax.

Defra figures showed that the average farm business income (FBI) was £86,000 across all farm types in Great Britain, in 2022/23, with 17% failing to make a positive FBI that year and only 41% making over £50,000.