In the nearly 3 years in which Real Wild Estates have been operating, any landowners we have chatted to willing to commit to nature restoration has faced a major intergenerational tax issue. HMRC’s policy on Agricultural Property Relief or APR and its application to nature-based land use – in effect an inheritance tax relief when passing on farming land to the next generation – had been unclear and unresolved. Many landholders were too concerned that this prized relief would not apply if they went down the nature restoration road, in whole or in parts, on big estates or even smallholdings.
So just in time to celebrate World Rewilding Day today, Jeremy Hunt’s last budget statement has now agreed to allow APR to apply to all government agri-environmental schemes, including Scotland’s Agri-Environment Climate Scheme, Wales’s Sustainable Farming Scheme and England’s Landscape Recovery scheme, treating them identically to other farming land uses, including arable and livestock. This is very good news – and is one less barrier to entry for those landowners committed to nature recovery or full-blown rewilding – but sadly its not quite far enough yet – or bold enough.
Frustratingly, it does not yet recognise the new nature finance sector – from private, corporate and institutional funding – that itself is being heavily encouraged and incentivised by British government policy. The need to clear this last barrier is desperately required to rocket power their own 30% by 2030 nature recovery and net zero targets, as well as stimulate the still sluggish development of the nature finance marketplace, recently highlighted by the advent of its front runner, Biodiversity net gain.
We need both DEFRA and HMRC to come together and agree joint policy here on APR otherwise we are handcuffing this developing marketplace. Let’s be honest, it’s time – and humankind – critical.