Inheritance Tax (IHT) changes could bring better fortune to farmers and their families later this year.
New rules, due to take effect in April, will result in new nil-rate IHT band levels.
The new rules, which apply to farmhouses that are left to lineal descendants, could create more opportunities for new entrants into the agriculture sector via Farm Business Tenancies (FBTs).
April 2017 will see the introduction of an inheritance tax Main Residence Nil Rate Band (MRNRB), which will allow residential property that has been occupied as a home to be passed to direct descendants, free of IHT.
The changes will bring more properties within the nil rate IHT band and offer married couples with lineal descendants a more direct and less complex way to pass on their property, as, at current, they must prove their dwelling house is a farmhouse.
Andrew Heskin, a partner specialising in capital taxes with Moore Thompson, said: “The New Year is always a good time to take stock of your financial affairs and, in particular, to check whether you are taking full advantage of the rules which apply to Inheritance Tax. By seeking expert advice, you will have taken all available steps to ensure that the assets you have worked hard to accrue, are passed to your chosen beneficiaries rather than to the tax man.
For advice on IHT and estate preservation including all aspects of future tax planning, please contact us.