The UK government is considering amendments to inheritance tax rules for farmers aged 80 and above, potentially allowing them to transfer farms to family members without incurring tax, regardless of the typical seven-year gifting rule.

This comes after significant protests by farmers in Westminster and a contentious debate with the government.

Recently, the Treasury began evaluating the impact of these proposed changes, particularly how they might affect small and medium-sized active farms compared to smallholdings.

Additionally, they are reviewing the implications of Labour's October budget, which introduced a 20% inheritance tax for farmers with businesses worth over £1 million.

Farmers have long depended on agricultural property relief (APR) to avoid inheritance tax, but recent proposals have sparked fears of financial burdens if farmers die within seven years of transferring their land.

Many argue that despite owning valuable assets, they remain cash-poor due to rising costs, poor harvests, and market pressures, with some taking home less than minimum wage.

The National Farmers’ Union suggested reducing the age threshold to 73 to align with the average UK life expectancy and allow such transfers without a seven-year survival requirement.

However, Treasury sources indicate that a comprehensive assessment is challenging due to a lack of detailed demographic data.

Labour defends targeting the tax at wealthy investors speculating on land, yet some argue that non-farmers with country homes benefit unfairly under current APR rules.

Farmers like Martin Williams from Herefordshire express gratitude for the Treasury's attention but urge further dialogue.

The environment secretary, Steve Reed, assured farmers at a recent conference that the government is open to discussions.

Despite ongoing debates, a Treasury spokesperson confirmed their commitment to implementing the new tax rules without mitigations.