Budget’s effects on landowners’ probate

Labour’s intention to accelerate the UK’s renewable energy program is laudable, but its £1 million cap on Inheritance Tax Relief (IHT) seems at odds with its goal.

A commercial-scale renewable energy project will almost certainly increase the value of land to over £1 million, if it isn’t already. Now more than ever, a will is crucial to ensure clear succession plans and avoid disputes among beneficiaries. Succession planning helps maintain the smooth operation of a business after the owner’s death and clarifies asset management intentions.

Business Property Relief and Agricultural Property Relief (APR) can reduce the tax burden on inherited land used as a business. From April 2026, combined business and agricultural assets over £1m will receive 50% relief, effectively taxed at 20%.

APR historically allowed small family farms to be passed through generations. But farmers fear the cap won’t make them viable.

You can consider gifting to reduce estate taxes upon death. This can be complicated if the gifts aren’t made early enough, as they will be taxed within seven years of death. But it can remove future appreciation from the taxpayer’s estate later in life.

For estate planning of wind farm projects and large acreage, seek professional advice.