{"id":3312,"date":"2025-06-04T09:14:53","date_gmt":"2025-06-04T08:14:53","guid":{"rendered":"https:\/\/www.robbtax.co.uk\/blog\/?p=3312"},"modified":"2025-06-04T11:55:44","modified_gmt":"2025-06-04T11:55:44","slug":"could-the-new-iht-rules-damage-your-businesss-value-on-paper","status":"publish","type":"post","link":"https:\/\/www.robbtax.co.uk\/blog\/could-the-new-iht-rules-damage-your-businesss-value-on-paper\/","title":{"rendered":"Could the new IHT rules damage your business\u2019s value on paper?"},"content":{"rendered":"<p>The Government\u2019s decision to halve Business Property Relief (BPR) and Agricultural Property Relief (APR) from April 2026 is already changing how family businesses and farms operate.<\/p>\n<p><!--more--><\/p>\n<p>While it falls under Inheritance Tax (IHT), the impact is reaching far beyond succession planning.<\/p>\n<p>According to official estimates, the reform is expected to raise an additional \u00a31.4 billion by the end of this Parliament.<\/p>\n<p>However, early indicators suggest a sharp drop in business confidence, with companies already making tough decisions in response.<\/p>\n<h3><strong>When confidence drops, valuations follow<\/strong><\/h3>\n<p>Reduced confidence is having a visible effect on business performance.<\/p>\n<p>Forecasts from Family Business UK (FBUK) suggest a loss in gross value added (GVA) of \u00a314.8 billion over the next five years, with \u00a36.5 billion of that linked to family-run businesses.<\/p>\n<p>More than 200,000 jobs could be lost, with over half of those cuts likely to happen before the April 2026 deadline.<\/p>\n<p>This is already feeding into how businesses are valued.<\/p>\n<p>Firms are scaling back investment, trimming headcounts, and forecasting weaker turnover, all of which are warning signals for buyers, lenders and investors.<\/p>\n<p>A business with falling investment or reduced profitability can quickly become a less attractive proposition, even if the fundamentals remain sound.<\/p>\n<h3><strong>If you are thinking about succession or sale, pay close attention<\/strong><\/h3>\n<p>If you are planning to sell your business, seek funding or hand it over to the next generation, these reforms may affect more than your future tax position.<\/p>\n<p>They could change how your business is perceived on paper.<\/p>\n<p>Valuations are sensitive to risk, and any uncertainty around future tax exposure, profit stability or leadership transition can weaken your position in negotiations.<\/p>\n<p>Many business owners are already acting.<\/p>\n<p>In a recent FBUK survey, 39 per cent said they were planning to gift shares or assets before April 2026.<\/p>\n<p>Around 16 per cent have already done so. These moves are designed to preserve business value while the rules remain in their current form.<\/p>\n<h3><strong>The numbers behind the noise<\/strong><\/h3>\n<p>The FBUK survey provides a bleak outlook for investment.<\/p>\n<p>84 per cent of businesses expect to cut investment after the rule changes take effect.<\/p>\n<p>Only two per cent expect to invest more.<\/p>\n<p>Turnover forecasts are similarly pessimistic, with just three per cent of businesses expecting growth.<\/p>\n<p>In the agricultural sector, the figures are nearly identical.<\/p>\n<p>These projected declines are likely to weigh heavily on business valuations, especially for those seeking funding or considering a sale in the next two to three years.<\/p>\n<p>Reduced investment often leads to reduced output, and in small family-run firms or farms, even small cuts can have a disproportionate effect.<\/p>\n<h3><strong>Every business will feel this differently, the key is not to wait<\/strong><\/h3>\n<p>While the IHT changes have a fixed date, their influence on business value is already unfolding.<\/p>\n<p>Decisions made now will shape how financially secure your business remains during this period of uncertainty.<\/p>\n<p><strong>If you are concerned about valuation, succession or your long-term position, speak to us today about a plan that protects your interests.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Government\u2019s decision to halve Business Property Relief (BPR) and Agricultural Property Relief (APR) from April 2026 is already changing how family businesses and farms operate.<\/p>\n","protected":false},"author":1,"featured_media":3315,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11,89],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Could the new IHT rules damage your business\u2019s value on paper? 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