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IHT and Agricultural Property – Europe Demands Equal Treatment
The European Commission (EC) has requested the UK to cease its discriminatory application of Inheritance Tax relief for agricultural property. What the EC is objecting to is not the relief, but the fact that, under UK law, agricultural property relief is available only in respect of agricultural and forestry property held in the UK, the Channel Islands or the Isle of Man, not in the entirety of the EU.
In the view of the EC, this is not compatible with EU law relating to the free movement of capital.
Says Peter Critchell, “If the Government is forced into changing the law, this will be good news for owners of agricultural businesses who have bought holdings in other EU countries.”