On 23rd December, the Government announced that the level of the Agricultural and Business Property Reliefs threshold will be increased from £1m to £2.5m when it is introduced in April 2026.
This allows spouses or civil partners to pass on up to £5m in qualifying agricultural or business assets between them before paying inheritance tax, on top of existing allowances.
Investments made through the SEIS and EIS often qualify for BPR. It is therefore likely that many S/EIS investors will benefit from the increase to these thresholds.
We welcome this increase in the amount which will attract 100% inheritance tax relief from from April 2026 and this will benefit some SEIS and EIS investors.
The fact that inheritance tax will be charged on some businesses is unfortunate and presents some practical problems. The EIS Association has made representations to government officials about the difficulties in valuing unquoted investments, and also in paying any tax liability, due to the illiquid nature of the investments.
These issues remain over £2.5 million (£5 million for spouses and civil partners). Thank you to our Tax & Technical Committee for their work on this and we will continue to engage with the Government on this issue.