A House of Lords debate held on 21st November, led by Baroness Northover, centred on the pressing issues facing farming families, particularly in light of recent governmental budget announcements impacting inheritance tax. The session illuminated the deep-seated concerns among small to medium-sized farms, often asset-rich but cash-poor, who feel starkly disadvantaged by the new tax regulations slated for 2026.

Baroness Northover voiced the collective anxiety received through numerous correspondences from distressed farmers, including poignant stories from Cornish farmers facing potential financial ruin. Emphasised was the significant role that farming families play in maintaining rural communities and ensuring UK food security. The urgency for government consultation and potential re-evaluation of policy was a resonating theme throughout the debate.

Read the debate transcript in full here.

NFU’s APR Analysis: An Overview

Recent analyses by the National Farmers' Union (NFU) have raised significant concerns regarding the government's proposed changes to Agricultural Property Relief (APR). Contrary to official estimates suggesting that only 27% of farms would be affected, the NFU's findings indicate that approximately 75% of commercial family farms will surpass the £1 million threshold, thereby facing increased inheritance tax liabilities.

The NFU's report highlights that many medium-sized farms may find the ten-year tax payment window insufficient, as the annual instalments could exceed their average returns. For instance, an average cereals farm, with a typical profit of £34,000, could face annual inheritance tax payments of £53,000 under the new APR threshold, significantly surpassing its earnings. This financial strain threatens the viability of these farms, potentially leading to the sale of assets or cessation of operations.

Explore the NFU’s report and analysis in full here.

Support from RABI During Challenging Times

In this challenging landscape, the Royal Agricultural Benevolent Institution (RABI) plays a crucial role in supporting the farming community. As a longstanding charity dedicated to the well-being of farming communities, RABI offers a range of services, including financial assistance, mental health support, and practical help.

Recognising the multifaceted challenges faced by farmers, RABI emphasises the importance of providing comprehensive support to ensure the resilience and sustainability of farming families.

Find out how you can access support from RABI here.