1. Inheritance Tax (IHT) Changes: Agricultural Property Relief (APR) and Business Property Relief (BPR)
One of the most impactful shifts in this year’s Budget is the adjustment to inheritance tax reliefs for agricultural and business property. Previously, APR and BPR provided 100% relief on qualifying assets. However starting from 6 April 2026, the joint relief will be capped at £1 million, with any excess assets qualifying for only 50% relief.
How This Affects You:
- If your assets exceed the £1 million threshold, these changes mean your estate could face a larger tax bill, making careful planning essential.
- Succession planning becomes even more critical for farms looking to pass assets through generations without incurring unsustainable tax burdens.
How Our Software Can Help:
- Our software’s financial tracking tools allow you to monitor asset values over time, helping you identify areas where IHT planning may be beneficial.
- With built-in reporting features, you can quickly generate summaries of your farm’s assets and projected tax liabilities, enabling you to plan effectively.
2. Capital Gains Tax (CGT) on Land Sales and Business Asset Disposal Relief (BADR)
From 30 October 2024, capital gains on non-residential property will now attract higher rates of 18% and 24%, up from previous rates of 10% and 20%. In addition, the Budget introduces a phased increase in CGT rates on Business Asset Disposal Relief gains, with rates set to reach 18% by 2026.
How This Affects You:
- Farmers planning to sell land or other non-residential assets may face increased capital gains liabilities.
- Those qualifying for Business Asset Disposal Relief should consider timing their sales or adjusting asset ownership to minimise tax exposure.
How Our Software Can Help:
- Budgeting and forecasting tools can help farmers evaluate the financial impact of potential asset sales, providing CGT projections based on the latest tax rates.
3. Employer National Insurance (NI) Increases
The Budget introduces an increase in employer National Insurance rates, rising from 13.8% to 15% (1.2% increase) on pay exceeding £5,000, with an expanded employer allowance of £10,500. This change presents a considerable cost increase for farms with full-time employees.
How This Affects You:
- Farms and estates employing multiple workers will likely see an increase in their payroll expenses due to the higher NI rates.
- These additional costs may require adjustments in budgeting, particularly for smaller farms operating on tight margins.
How Our Software Can Help:
- Payroll management tools allow you to track employee costs accurately and assess the impact of the new NI rates on your bottom line.
4. Stamp Duty Land Tax (SDLT) Increase
The Budget also raises the higher rate of Stamp Duty Land Tax on residential properties purchased by companies or individuals who already own property, from 3% to 5%.
How This Affects You:
- For landowners interested in expanding their property holdings, this increase means higher upfront costs.
- If your estate includes residential properties, this change could influence future purchase decisions and capital investment plans.
How Our Software Can Help:
- Financial forecasting tools features enable you to compare different investment scenarios to ensure your purchases align with budgetary and tax constraints.
Why Choose Our Software for Farm Business Management?
Our software is specifically designed to support farmers and landowners with the data and insights needed to make well-informed financial decisions. Whether you’re navigating inheritance tax planning, managing payroll, or evaluating land acquisitions, our software offers comprehensive tools to keep your business on track. Having the relevant information to hand will deliver on the hard facts and give you the insight you need to work with relevant advisors to plan for the future.
- Tailored Reports and Breakdowns: Generate detailed financial reports tailored to your farm’s needs, providing a clear picture of profitability, cash flow and costs.
- Intuitive Financial Planning: Stay ahead of tax changes and plan proactively for IHT, CGT, and SDLT costs.
- Friendly, Knowledgeable Support Team: Our team understands the unique challenges of farm management and is here to offer guidance and answer any questions you may have.
In light of the Autumn Budget, it’s more important than ever for farmers and landowners to stay informed and proactive. Our software can simplify financial planning, enhance your farm’s operational efficiency, and provide the insights you need to make the best decisions and allowing you to invest money.
Want to learn more? Contact us today for a free, no-obligation consultation and see how our software can make a difference in your farm business. Let us help you navigate these new changes with confidence.