IHTM24017 - Overview of agricultural relief: deceased as landlord

Once all the facts regarding the deceased’s letting of agricultural property have been established, and it has been confirmed that any farmhouse, ( IHTM24091) farm cottages and ( IHTM24092) farm buildings ( IHTM24093) were occupied for agricultural purposes ( IHTM24060), you will need to make a referral to the District Valuer.( IHTM23002). You will need to ask for an opinion on both the market and agricultural values of each element. If, in the District Valuer’s opinion, the open market value for any of the elements does not exceed the agricultural value, a formal valuation is not required.

If business relief (IHTM25130) is available on any value over and above the agricultural value ( IHTM24150) of agricultural property, you should advise the District Valuer. The guidance at IHTM24151 outlines when business relief can apply to let property.

Before FA95/S155 introduced the higher rate of relief on tenancies created on or after 1 September 1995 ( IHTM24240) it was not uncommon to see it claimed that an agricultural tenancy ( IHTM24210) did not exist on cases where the land was occupied

• by a partnership (whether the deceased was a member or not), or
• by a company controlled by them, or
• by a third party

If no tenancy existed vacant possession could be obtained and relief at 100% rather than 50%would apply. In any such case you should investigate whether an agricultural tenancy did exist unless you have evidence that the land was subject to grass keep lettings ( IHTM24143) for less than a year at a time.

(This text has been withheld because of exemptions in the Freedom of Information Act 2000)

Again, even though 100% relief may be due you will need to check with the DV to see whether there is any value over and above the agricultural value.