Farmland ‘could prevent Britons from paying inheritance tax’

Posted 04/08/2010

People looking to carry out estate planning should be aware that they may be eligible for inheritance tax exemption if they own farmland.

According to This Is Money, farmland is currently becoming popular with investors thanks to its wealth management benefits, as the property can be kept tax-free if it is being actively farmed.

Lee Boyce, writer for the personal finance website, suggested that those who are involved with the work on their farmland could apply for complete exemption from inheritance tax, while those who merely own the land could still get a 50 per cent reduction.

He advised: ‘Be warned – ‘actively farmed by you’ does actually mean you being personally involved in farming the land and agricultural buildings and farmhouses must meet strict criteria.’

Investor Today also recently reported that farms qualifying for Agricultural Property Relief and Business Property Relief could be passed down without inheritance tax following the death of the owner.