Inheritance Tax
Inheritance Tax has been in the headlines a lot recently with the publication of the case known as Antrobus. There is a mis-conception that agricultural property is automatically free from Inheritance Tax, given the wide use of Agricultural Property Relief, which at 100% results in zero tax being payable in many cases.
Stephen Rutledge of Fisher German’s Banbury office points out, “The Inland Revenue’s attitude to agricultural property has changed, as they try and keep pace with the significant increases in residential property and amenity land prices. The case of Antrobus is a good example of this. It is very important to be clear, that there is a crucial difference between agricultural value and Market Value. Agricultural value is broadly defined as being “the value of a property assuming it is subject to a perpetual covenant restricting its use to agriculture”. The impact of such a covenant is very subjective and depends entirely on the circumstances of the case.”
In Antrobus, the Lands Tribunal held that the agricultural value of the farmhouse at the property concerned was 70% of its Market Value representing a discount of 30% off Market Value. Antrobus and the 30% discount is not legal precedent, nor even a rule of thumb, but it will undoubtedly provide the Inland Revenue with a compelling argument.
For further information about Fisher German’s valuation services please contact Stephen Rutledge on 01295 226292 or email: stephen.rutledge@fishergerman.co.uk
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