HTA response to increase in inheritance tax relief threshold

23 December 2025

The Horticultural Trades Association (HTA) has welcomed today’s Government announcement that the Inheritance Tax (IHT) reliefs threshold will rise to £2.5 million for businesses. Proposed changes to IHT reliefs in the 2024 Autumn Budget were set to create a ‘lose-lose’ scenario for the UK.

Changes announced today (23 December) mean the £1 million Agricultural and Business Property Reliefs threshold will increase to £2.5 million from April 2026, allowing spouses or civil partners to pass on up to £5 million in qualifying agricultural or business assets between them.

The HTA has campaigned on this issue since the 2024 Autumn Budget, including setting out the risks of this policy leading to a reduction of £60 million in the UK's environmental horticulture sector, with broader economic losses amounting to £143 million due to decreased industry activity. Additionally, the changes may have resulted in the loss of 1,300 sector jobs.

 

The changes announced:

• The allowance for the 100% rate of relief will be set at £2.5 million, with a 50% rate of relief thereafter.
• This means a married couple or civil partners can pass on agricultural or business assets worth up to £5.65 million tax free, by combining two £2.5 million agricultural/business property allowances and two £325,000 nil‑rate bands that can be transferred between them on death. 

 

Jennifer Pheasey, Director of Policy and Public Affairs at the Horticultural Trades Association (HTA) said:

“We welcome today’s announcement that the Government is raising the threshold on Agriculture Property Relief (APR) and Business Property Relief (BPR), which will be a huge relief for many family-owned environmental horticulture businesses. 69% of our members were at risk of being disproportionately hit by the proposed changes to BPR, and 40% by APR.

“The HTA has been tirelessly campaigning on both these issues since the changes were first announced in the 2024 Autumn Budget, knowing that Inheritance Tax changes would have a devastating impact on many families at the heart of the UK’s environmental horticulture sector, the original green industry. The cost hikes facing our sector have and continue to be severe, and so reducing the impact of one of these is a welcome step, and we look forward to constructive engagement on how we can address further barriers to growth.

“The environmental horticulture sector is a cornerstone of the UK’s green economy, underpinning the nation's green infrastructure – from nurseries providing trees for planting targets to businesses maintaining public spaces and private gardens. We are pleased that the Government has finally listened, choosing to support small, family-owned businesses in a sector which contributes £38 billion to UK GDP every year and supports more than 722,000 green jobs.”