High Court rejects farmers' challenge to inheritance tax changes

Farmers have lost a High Court bid to challenge the government’s controversial inheritance tax reforms, in the latest setback for campaigners opposing changes to agricultural property relief and business property relief.

The reforms have sparked months of anger across the farming sector amid fears they could threaten family farm succession and place additional financial pressure on rural businesses.

The legal action was brought by farmers Thomas Martin and George Martin alongside campaign group Farmers and Businesses for Fair Tax Reliefs.

The challenge focused on the government’s consultation process rather than the inheritance tax reforms themselves.

The claimants argued the Treasury and HMRC acted unlawfully by failing to carry out a full public consultation before introducing the changes.

However, the Treasury and HMRC defended the case, arguing the claim lacked merit.

In a ruling handed down on Tuesday 12 May, the High Court rejected the challenge.

Lady Justice Whipple said the claimants had no “legitimate expectation” of the type of consultation they argued should have taken place.

Sitting alongside Mr Justice Fordham, she also found there had been “no clear and unambiguous promise of a full consultation on the reforms proposed”.

The judges further ruled the claim had been brought too late.

They also concluded parts of the dispute could not be decided by the courts because they related to parliamentary proceedings.

The inheritance tax reforms were first announced in the autumn 2024 Budget and came into force on 6 April this year.

Changes to agricultural property relief and business property relief triggered large-scale tractor protests in central London and widespread criticism from farming organisations and rural campaigners.

Many farming families fear the changes could force the break-up or sale of farms to meet inheritance tax liabilities.

During a hearing in March, lawyers representing the farmers argued the government had failed to follow its own consultation policy for significant tax reforms.

Aparna Nathan KC, acting for the claimants, told the court government policy normally required at least one formal written public consultation before major tax changes were introduced.

The court heard the government later published a consultation document on 27 February 2025, but the claimants argued it covered “only a very limited aspect” of the reforms.

The farmers alleged the government had acted unfairly and breached principles of good administration by failing to properly consult affected taxpayers.

Lawyers representing the Treasury and HMRC argued the policy commitment to consultation only applied “where possible” and was not an absolute requirement.

The ruling marks the latest development in the ongoing backlash against the inheritance tax reforms.

Farming groups continue to warn the changes could place major pressure on family-run farms, succession planning and long-term investment across the agricultural sector.