Farm leaders have come together to call on the chancellor to consider the ‘crippling effect’ that changes to inheritance tax (IHT) reliefs would have on farming businesses.

Coming together, the leaders of the four UK farming unions – the NFU, NFU Scotland, NFU Cymru and the Ulster Farmers Union – detailed in a letter to Rachel Reeves that any changes would land a ‘devastating blow’ to family farms.

Speculation is growing that the upcoming budget may involve a review of inheritance tax reliefs, specifically agricultural property relief (APR) and business property relief (BPR), potentially leading to their abolition or reduction.

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The unions argue that these reliefs enable working farm businesses to be transferred to the next generation of farmers without incurring inheritance tax, which could otherwise force them to sell their businesses to cover the costs.

APR is viewed as crucial for farmers who lease land, as 64% of farmland is utilised by farmers who rent part or all their land.

The NFU stated they are ‘incredibly concerned’ about the growing speculation IHT reliefs may be subject to review and believe that any changes would go against reassurance provided by Defra secretary, Steve Reed that they would go unchanged.

NFU President Tom Bradshaw, alongside the other farming unions, has been in discussions with the treasury for several weeks given the devastating blow it could have on British farming.

He said: "It’s hard to see anything which would destroy the new government’s relationship with farmers more completely, or do more damage to family farm businesses, be they the owners of farms or the tenants who farm them for the landlord."

In the letter, the unions highlighted the foundation that IHT provided for farm operations of varying sizes and how any alterations would impact every food producing business country wide.

Given that the average working farm business produces a return of under 1%, most would fail to meet inheritance tax charges should APR or BPR be removed.

Mr Bradshaw elaborated: “Changes to vital IHT reliefs for farm businesses don’t only threaten our food security, but also the shared ambition with government to protect and enhance our environment.

"Without the farm businesses there to manage the land and invest in environmental and biodiversity delivery, legislated targets could be in jeopardy.

“For the future of our family farms, food security and the environment we are calling on the chancellor to urgently consider the sizable effect changes to APR and BPR could have.

"Farmers have been let down year after year by empty words and policies that negatively impact their businesses, I am imploring the chancellor, don’t let that happen again on 30 October.”

The NFU have written directly to the Prime Minister in an attempt to prevent any cuts to rural sector budgets and to take into consideration the role of farming businesses in serving the nation.