Inheritance tax is a tax imposed on the estate of a deceased person. In the United Kingdom, inheritance tax is charged at 40% on the value of an estate above a certain threshold. This threshold is currently £325,000 for individuals and £650,000 for couples. For those with larger estates, inheritance tax can be a significant burden.
Fortunately, there are ways to reduce or even avoid inheritance tax altogether. One of these is agricultural property relief (APR).Agricultural property relief is a form of relief from inheritance tax that applies to agricultural property. It is available to those who own agricultural land or buildings used for agricultural purposes. The relief applies to both the land and buildings, as well as any associated machinery and equipment.
To qualify for APR, the land or buildings must have been used for agricultural purposes for at least two years prior to the death of the deceased. The amount of relief available depends on the type of property and how it has been used. For example, if the property has been used solely for agricultural purposes, then 100% relief may be available. If the property has been used for both agricultural and non-agricultural purposes, then only 50% relief may be available. In addition, if the property has been let out to a third party, then only 50% relief may be available. In order to claim APR, an application must be made to HM Revenue & Customs (HMRC).
The application must include evidence that the property has been used for agricultural purposes for at least two years prior to the death of the deceased. This evidence can include receipts for farm supplies, accounts from farm workers, and other documents that demonstrate that the property was used for agricultural purposes. Once an application has been made, HMRC will assess it and decide whether or not APR is applicable. If it is applicable, then inheritance tax will be reduced or even eliminated altogether. This can be a great way to reduce or avoid inheritance tax in the UK.
In conclusion
, agricultural property relief is a form of relief from inheritance tax that applies to agricultural property in the UK.It can be a great way to reduce or even avoid inheritance tax altogether. To qualify for APR, an application must be made to HMRC and evidence must be provided that the property has been used for agricultural purposes for at least two years prior to the death of the deceased.
