Working farmers on modest incomes are being pushed into the tax bracket of the super-rich, campaigners warn, after October's 2024 budget left many facing inheritance tax bills that could break apart family farms.
Fairer Family Farming — a new grassroots coalition of working farmers — argues that individuals earning little more than the average UK household will be “treated as multimillionaires” under the Treasury’s plans.
The group says the approach is neither fair nor sustainable, insisting that ministers should raise revenue from “those who seek to avoid it” rather than threaten the futures of family-run farms.
Farmers say their sector underpins rural life, powering local economies, providing skilled jobs and sustaining whole communities. Many live on the land they work, often on farms handed down through generations. Yet half of farm households earn under £50,000 a year, with more than a third below £25,000.
Under the proposed inheritance tax changes, which roll out from April 2026, older farmers fear they face impossible choices. Retiring and passing on the farm could mean losing the right to remain in their homes or draw pension income from the land.
Staying put, however, risks leaving their children with bills they cannot meet without selling or breaking up the farm. Campaigners say the system has “created a lottery”, with families’ futures depending on whether a death occurs before April 2026 or within the following seven years.
The government is facing mounting anger across the farming community. More than 12,000 people have written to MPs, and farmers are planning a major tractor protest in London ahead of the chancellor’s autumn budget on 26 November.
The proposed policy would cap inheritance tax relief for agricultural and business property at £1 million, with assets above that threshold receiving only 50% relief.
Industry leaders warn this would force many families to sell land or dismantle long-established farms to pay large tax bills — a move they say could devastate rural economies and the traditions built over generations.
Farmers stress that their work cannot be reduced to a financial asset class. The sector contributes £13.7bn to the UK economy each year and supports almost half a million jobs — roughly one in every seventy. It is central to national food security and plays a major role in keeping food affordable.
There is also growing concern that current rules are driving more farmland into the hands of anonymous offshore owners. Campaigners argue this not only removes economic value from local communities but raises national security risks.
With 69% of the UK’s land classed as agricultural, and military sites often bordered by farmland, they warn that foreign actors could exploit land purchases for surveillance as drone and monitoring technologies evolve.
Although ministers have correctly identified the use of farmland as a tax shelter, farmers say the government’s solution penalises working families rather than passive investors.
Research by CenTax — the Centre for the Analysis of Taxation — offers what they call a “viable alternative”: a minimum share rule allowing tax relief only when farm or business assets account for at least 60% of an estate.
According to CenTax, this approach would shift the burden to those using farmland purely to avoid tax, raise revenue from those best able to pay, and protect working family farms whose incomes sit at or below the national average.
Campaigners argue that the choice is now clear: back a fairer system, or risk dismantling the fabric of Britain’s rural economy.
