IHTM24155 - Value and Valuation: Interaction with exemptions
Agricultural relief reduces the value transferred (IHTM04028) by a transfer of value (IHTM04024). Consequently it is applied before any exemptions are deducted and before the value of any agricultural property that is chargeable to tax is grossed up. (IHTM26101)
However, with effect for deaths and other transfers of value from 6 April 2026 the allowance for 100% agricultural relief will only apply to chargeable transfers of qualifying property. A transfer of qualifying property to an exempt beneficiary such as a spouse/civil partner, or a charity, will not use any part of the 100% allowance.