UK BPR and APR Changes from April 2026: What the £1 Million Cap Means for You
July 29, 2025
New Rules for BPR and APR: The £1m Cap Is Here to Stay
After months of anticipation, the UK government has finally published draft legislation detailing how business property relief (BPR) and agricultural property relief (APR) for inheritance tax will change from April 2026.
Contact us
The headlines?
A £1 million cap per individual for full relief, a partial fallback at 50%, and very little movement from the original Budget announcement in October 2024.
For advisers, business owners, and trustees, this is the shape of things to come and the planning window is narrowing.
What’s changing?
Each individual will have a £1 million lifetime allowance for 100% BPR/APR. Any qualifying value above that cap will attract only 50% relief.
The allowance will refresh every 7 years, but the draft legislation confirms that failed PETs and CLTs will reduce what’s left when you die.
Trusts have their own separate regime. Each relevant property trust will receive an allowance, refreshed every 10 years, which determines how much 100% relief applies on IHT events (e.g. ten-year anniversaries, exits).
Transitional rules apply to pre-2024 settlements. And yes, some trusts will now face IHT for the first time.
Any major concessions?
Not really.
Despite lobbying from all corners including industry bodies, estate planners, landowners, the government is largely sticking to its plan:
The £1 million cap remains fixed, although from 2030 it could be increased with CPI. But it’s not automatic as iit needs a statutory instrument, and we all know how that played out with the nil-rate band (£325,000 since 2009).
The allowance is not transferable between spouses. Despite many calls to allow this, the government concluded that it “would carry an Exchequer cost” and declined.
Proposals to split the allowance across chosen assets (e.g. during a CLT) were rejected as unworkable. Instead, the cap will be used up chronologically.
Suggestions to apply anti-fragmentation valuation rules were partly accepted. Trusts created by the same settlor will have their caps applied in order, but no valuation aggregation across trusts will apply.
What now?
Time for action.
Here are five key planning areas and some key questions to reflect on:
Model your IHT exposure:
How much would be payable under the new regime? Is your Will structured to preserve the 100% cap? Do your beneficiaries have liquidity?
Consider trusts:
A CLT now could still attract full relief if completed before April 2026. But after that, only £1 million qualifies at 100% and 10-year charges will need managing.
Review old trusts:
Will they have sufficient cap available? Can the IHT be funded? What do the trust documents say about winding up?
Gifting:
Is now the time to pass value to the next generation? If so, review company articles, shareholder agreements and estate plans for those receiving the asset.
Insurance:
If your estate faces an unavoidable IHT bill, life cover may still be a useful (and tax-efficient) tool.
Final thoughts
- The publication of draft legislation confirms that this isn’t just a consultation idea… it’s happening.
- From April 2026, £1 million is the limit for full relief, and everything above that will be in play.
- Planning early may make the difference between an IHT bill and a preserved legacy.
Get clear on what the £1m BPR/APR cap means for you
The new rules for Business Property Relief and Agricultural Property Relief are now in black and white — and from April 2026, anything above £1 million will no longer qualify for full relief.
If you're a business owner, landowner, trustee or adviser, now is the time to review your position.
We can help you:
- Assess how the new cap will impact your estate or your clients
- Make use of available reliefs before April 2026
- Restructure trusts and gifting strategies effectively
- Prepare for IHT charges that may now apply for the first time
Need advice?
We support individuals, families and advisers with inheritance tax planning across the UK and internationally.
Is Dubai still safe in 2026? Explore how Iran tensions are affecting UAE relocation decisions and what HNWIs should consider before moving.
Dubai continues to attract high-net-worth individuals from the UK and around the world. Its tax efficiency, strong infrastructure and international business environment make it an appealing base for both personal wealth and global business operations. However, relocating or investing in Dubai without proper planning can lead to costly mistakes. Understanding the legal, financial and cultural environment before making decisions is essential. Below are some of the most common pitfalls HNWIs should avoid when relocating to Dubai in 2026... Overlooking Tax Planning A common misconception is that living in Dubai means there are no tax considerations. While the UAE has no personal income tax, the regulatory environment has evolved in recent years. The introduction of UAE corporate tax, VAT and international tax reporting requirements means individuals with businesses, investments or global income streams still need structured tax planning. Those relocating from the UK must also consider the implications of the Statutory Residence Test, potential split-year treatment and double taxation agreements. Failing to structure finances properly before relocating can create unnecessary tax exposure in multiple jurisdictions. Rushing Property Investments Dubai’s real estate market offers strong opportunities, but it also requires careful due diligence. Off-plan property purchases in particular should be approached cautiously. Buyers should review the developer’s track record, financial strength and delivery history. Market cycles are also important to consider, especially as increased supply in certain areas could lead to price corrections in the future. Taking time to assess location, developer credibility and long-term demand helps protect capital and avoid poorly performing investments. Underestimating the Real Costs of Property Ownership The advertised purchase price is only part of the financial commitment when buying property in Dubai. Investors should also factor in: The Dubai Land Department (DLD) transfer fee of 4% Ongoing service charges for buildings or communities Maintenance and management costs Ignoring these costs can significantly impact overall investment returns. Failing to Prepare for Banking Requirements Opening bank accounts in the UAE can be more complex than many expect, particularly for international clients. Banks require extensive documentation to comply with international anti-money laundering regulations. If financial structures or documentation are unclear, accounts can be delayed, restricted or even frozen. Ensuring all financial arrangements are transparent and properly structured before relocation makes the process significantly smoother. Misunderstanding Residency and Visa Options Many individuals assume residency can be arranged later or through temporary arrangements. In reality, visa planning should be part of the relocation strategy from the outset. For example, long-term residency options such as the UAE Golden Visa have specific investment and eligibility criteria. Understanding these requirements early allows individuals to structure investments and assets accordingly. Ignoring Local Laws and Regulations Dubai is known for its safety and order, but this is supported by a strict legal framework. Actions that might be overlooked elsewhere, such as offensive language, inappropriate social media content or public intoxication, can carry significant legal consequences. Financial transactions and business activities are also closely regulated. Taking time to understand the legal environment helps avoid unnecessary issues. Underestimating Cultural and Lifestyle Differences Dubai is an international city, but it operates within a framework of local customs and expectations. Respect for public behaviour, dress standards in certain locations and cultural sensitivity are all important. Practical factors such as the extreme summer climate can also affect lifestyle choices and property decisions. Understanding these aspects helps individuals settle comfortably and avoid unnecessary challenges. How Mosaic Chambers Group Can Help Relocating to Dubai is rarely just about moving location. It involves tax planning, asset structuring, property considerations, residency strategy and cross-border compliance. At Mosaic Chambers Group, we support high-net-worth individuals and entrepreneurs with the strategic planning needed to relocate with confidence. Through our international network of tax advisers, legal specialists and relocation partners, we help clients: Structure their affairs before leaving the UK Manage cross-border tax exposure Understand residency and visa options Conduct proper due diligence on investments Establish compliant financial and banking arrangements Careful planning at the outset can prevent costly mistakes later. If you are considering relocating to Dubai in 2026, speak to Mosaic Chambers Group to ensure your move is structured correctly from day one. Contact Us