Farm inheritance tax calculator

From 6 April 2026, agricultural and business property relief is limited to the first £2.5 million at 100%, with 50% above it. Enter what the farm and the rest of the estate are worth to see the tax now, what it would have been before, and the yearly instalments.

Updated 18 October 2026

Farm inheritance tax calculator

Land, farm buildings, cottages let to farm workers, machinery, livestock and the trading business: what qualifies for agricultural or business property relief. Include the farmhouse only if it qualifies.

Savings, investments, a house that does not qualify, let residential property, less any debts.

The owner is

Married or in a civil partnership? Whatever passes to a spouse is exempt, so work this out for the second death, as widowed.

A home left to children or grandchildren?

Adds the residence band of £175,000, which shrinks by £1 for every £2 the estate is worth over £2 million.

Enter what the farm and the rest of the estate are worth to see the inheritance tax under the rules from 6 April 2026, and what it would have been before.

Full relief up to

£0.0m

farm and business assets, per person

Above it

0%

effective rate, with 50% relief

Couple, tax free

£0

with both nil-rate bands

Paying more in 2026-27

0

estates; 85% pay nothing more

Source: HM Treasury, changes to agricultural property relief, updated 23 December 2025.

How it works

01

What changed on 6 April 2026

Until April 2026, qualifying agricultural and business property could pass free of inheritance tax with no upper limit. Now each person has an allowance of £2.5 million for the two reliefs combined at 100%. Above it, relief is 50%, so the tax on that part is an effective 20% rather than the usual 40%.

The government expects up to 185 estates claiming agricultural property relief to pay more in 2026-27, and 85% of estates claiming it to pay nothing more.

02

Couples and the transferable allowance

Anything left to a spouse or civil partner is exempt. Their unused £2.5 million allowance then passes to the survivor, as does the £325,000 nil-rate band, so a couple can pass on up to £5.65 million of qualifying property and other assets free of tax between them. If the first death was before 6 April 2026, the full £2.5 million is treated as available to transfer.

03

Paying the tax

Tax on qualifying farm and business property can be paid in ten equal yearly instalments, interest free, so a farm does not have to be sold to meet a bill on death. The calculator shows the share of the tax that falls on those assets and the yearly amount.

04

What it leaves out

The calculator gives a broad estimate. An adviser will look at the detail, including:

  • Which assets qualify: relief needs the land to be occupied for agriculture for two years by the owner, or owned for seven if it is let
  • The farmhouse, which qualifies only if it is of a character appropriate to the farm
  • Gifts in the seven years before death, trusts, and lifetime planning
  • AIM shares, which now get 50% relief

05

Knowing what the estate holds

Succession planning starts with a clear record of the land, the buildings, the tenancies and what each earns. TenantTool keeps every field, cottage, unit and agreement on an estate in one place, ready to share with an accountant or solicitor.

Common questions.

How much can a farmer pass on free of inheritance tax from April 2026?
One person can pass on £2.5 million of qualifying farm and business property at 100% relief, plus the £325,000 nil-rate band, so £2.825 million. A married couple or civil partners can pass on up to £5.65 million.
What is the inheritance tax rate on farms above the allowance?
Qualifying property above the £2.5 million allowance gets 50% relief, so it is taxed at an effective 20% instead of 40%.
Can farm inheritance tax be paid in instalments?
Yes. Tax on qualifying agricultural and business property can be paid in ten equal yearly instalments, interest free.