Shorter Reads

IHT on UK farming land and buildings held through offshore companies

Hidden within the post-Budget policy papers is a significant shift in the UK inheritance tax landscape. Offshore structures that have historically shielded UK agricultural land and buildings from IHT are now in the Government’s sights. From 6 April 2026, these assets will fall squarely within the UK IHT net, regardless of any intermediary offshore holding.

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Published 2 December 2025

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Hidden in the detail of the policy papers published after the Budget, is a notable—and, in some respects, unexpected—shift in the inheritance tax landscape.  Long-established planning tools, particularly those relying on the UK’s “situs” rules, are now squarely in the crosshairs. These rules have historically enabled non-domiciled (and now non long-term resident) individuals (and their “excluded property” trusts) to hold UK assets through non-UK entities to mitigate exposure to UK inheritance tax (IHT).

What is striking is the Government’s characterisation of these measures as “anti-avoidance” legislation. While no draft text has yet been published, the intent is clear: the scope of IHT will be expanded so that, in addition to UK residential property, UK agricultural land and buildings will always fall within the UK IHT net—regardless of any intermediary offshore holding structure. In other words, offshore structuring will no longer provide a shield for these types of assets (as is already the case with UK residential property post 2017).

These changes are set to take effect from 6 April 2026, aligning with the commencement of the forthcoming restrictions to Agricultural Relief and Business Relief. The timing is deliberate; the impact will be significant.

It is difficult to ignore the punitive targeting of agricultural property, whilst businesses are not subjected to the same level of scrutiny—even though a number of business owners are considering leaving or have already left the UK and seek to use these “situs” rules to remove their businesses from the scope of UK inheritance tax.

Ultimately, the move reflects a broader policy trend: a tightening of perceived loopholes and a recalibration of the UK IHT regime, with agricultural assets seemingly bearing a disproportionate share of the burden. Stakeholders in the agricultural sector—and advisers to international families—should begin reviewing existing structures now, well ahead of the 2026 implementation date.

For tailored advice on how these upcoming IHT changes could affect your agricultural assets or offshore structures, get in touch with our team of experts today.

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Shorter Reads

IHT on UK farming land and buildings held through offshore companies

Hidden within the post-Budget policy papers is a significant shift in the UK inheritance tax landscape. Offshore structures that have historically shielded UK agricultural land and buildings from IHT are now in the Government’s sights. From 6 April 2026, these assets will fall squarely within the UK IHT net, regardless of any intermediary offshore holding.

Published 2 December 2025

Associated sectors / services

  • Private Wealth
  • Tax & Estate Planning
  • Trusts
  • UK trusts, tax and estate planning

Authors

Hidden in the detail of the policy papers published after the Budget, is a notable—and, in some respects, unexpected—shift in the inheritance tax landscape.  Long-established planning tools, particularly those relying on the UK’s “situs” rules, are now squarely in the crosshairs. These rules have historically enabled non-domiciled (and now non long-term resident) individuals (and their “excluded property” trusts) to hold UK assets through non-UK entities to mitigate exposure to UK inheritance tax (IHT).

What is striking is the Government’s characterisation of these measures as “anti-avoidance” legislation. While no draft text has yet been published, the intent is clear: the scope of IHT will be expanded so that, in addition to UK residential property, UK agricultural land and buildings will always fall within the UK IHT net—regardless of any intermediary offshore holding structure. In other words, offshore structuring will no longer provide a shield for these types of assets (as is already the case with UK residential property post 2017).

These changes are set to take effect from 6 April 2026, aligning with the commencement of the forthcoming restrictions to Agricultural Relief and Business Relief. The timing is deliberate; the impact will be significant.

It is difficult to ignore the punitive targeting of agricultural property, whilst businesses are not subjected to the same level of scrutiny—even though a number of business owners are considering leaving or have already left the UK and seek to use these “situs” rules to remove their businesses from the scope of UK inheritance tax.

Ultimately, the move reflects a broader policy trend: a tightening of perceived loopholes and a recalibration of the UK IHT regime, with agricultural assets seemingly bearing a disproportionate share of the burden. Stakeholders in the agricultural sector—and advisers to international families—should begin reviewing existing structures now, well ahead of the 2026 implementation date.

For tailored advice on how these upcoming IHT changes could affect your agricultural assets or offshore structures, get in touch with our team of experts today.

Associated sectors / services

  • Private Wealth
  • Tax & Estate Planning
  • Trusts
  • UK trusts, tax and estate planning

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