For those hoping to pass on wealth to the next generation, there was more bad news with significant changes to two key elements of an individual’s estate.
The Government is tightening the Inheritance Tax (IHT) system by imposing the tax on unspent pension pots from April 2027 and cutting back the benefits of agricultural property relief and business property relief.
Despite existing nil-rate bands and exemptions, the 100 per cent relief will only apply to the first £1 million of combined agricultural and business assets, dropping to 50 per cent after that – adding pressure on family farms and businesses.
The Government also plans to reduce business property relief to 50 per cent across the board for shares “not listed” on recognised stock exchanges, like AIM.
Also, while the tax rates on Income Tax will be unfrozen from April 2028, for IHT the nil-rate bands will remain unchanged until April 2030.