‘I’ve been a farmer all my life - Rachel Reeves’ tax would mean a £500k bill for my son'

A farmer is worried his son could be landed with a £500,000 bill upon his death due to Rachel Reeves' inheritance tax changes. Jeremy Yabsley, 69, has been farming all his life, including dairy, and now looks after 80 yews, from which he sells lamb. In the face of rising costs, he, along with many others, has diversified, as he licences lakes to an angling club and a shoot is run on his land, which was owned by his wife's father, near Witheridge in Devon. He has also carried out property development.

Mr Yabsley told the Express that, if he and his wife were to pass away after April 6, a half-million charge would be levied on his son, who runs a forestry business. This is just based on capital, and does not include machinery and animals, and the overall cost, Mr Yabsley thinks, would mean some land would probably have to be sold.

"It's destructive," he said. "Blatantly destructive." Mr Yabsley added that a lot of farming today revolves around nature conservation, which is "important". "But, what I've been trying to remind everyone is, our primary function is food production," he added.

"That's my primary function, and I want to see that continue, and it's got to be viable, hasn't it?"

The retired Conservative county and district councillor also said that he had not been allowed re-entry into the SFI scheme, costing him around £3,000 to £4,000 a year of "pure income".

Nowadays, Mr Yabsley has to be on the farm, and he therefore quit politics at the last local elections.

He is still doing a bit of relief milking at the weekends, because he enjoys it. But this is on a commercial site.

"What I've seen is farming has become more commercial. It was doing that before this government went in, but it's given it a real kick towards commercial now.

"Because they've got to be, there isn't the cushion there."

Conservative shadow farming minister Robbie Moore said that Ms Reeves' stance is "negatively impacting many of our family businesses, our farming businesses and our rural economy".

He added: “This is a cliff-edge policy. This is a tragedy tax that the Government are bringing in.

"The Government are unwilling to even listen appropriately to this level of concern.”

During a meeting of farmers at Mr Dart's farm on Friday, he described how he had encountered a 78-year-old farmer with cancer, who told him that, if he were to die before April 6 next year, he would not have to pay a penny more.

But, if he were to pass away after that date, he would have to hand over more than £1million.

The Chancellor announced during her autumn Budget that the Treasury would apply taxes to agricultural assets over £1million from April next year.

The National Farmers Union (NFU) has said ahead of the Spending Review on Wednesday that health and defence are expected to be protected but all other budgets, including Defra’s, are "expected to be under considerable threat".

The union added: "At stake for our industry is Defra’s funding for areas such as ELMs (Environmental Land Management schemes), flooding, research and development, biosecurity, and agri-tech."

A Government spokesperson said: “The vast majority of estates claiming these reliefs will still pay no additional inheritance tax, and those that do will pay a reduced rate and be able to pay over 10 years interest-free. This is a fair and balanced approach to help fix the public services we all rely on.

“We are also investing £5billion into farming over two years, the largest amount for sustainable food production in our country’s history, and are going further with reforms to boost profits for farmers by backing British produce and reforming planning rules on farms to support food production."

Ministers emphasise that nil-rate bands mean two people with farmland can pass on up to £3 million without paying any inheritance tax.

They add that, for assets above the £1million allowance, individuals will access 50 per cent relief from inheritance tax and will pay inheritance tax at a reduced effective rate up to 20 per cent, rather than the standard 40 per cent.