HMRC has recently updated its guidance on what constitutes agricultural land for inheritance tax purposes, now specifically including land used for the production of grapes for wine and apples for cider.
The updated HMRC guidance states that land used for “cultivation to produce food for human and animal consumption” where the definition of food in this context includes “grapes grown to produce wine and apples grown to produce cider” does qualify for agricultural property relief.
It seems logical that although only grapes and apples are specifically mentioned, a case could also be made for other fruit, such as pears grown to be used in alcoholic drinks, to be included in the definition of food. This would, however, need to be assessed on a case-by-case basis.
I’m sure this will come as good news to many in Cornwall and the South West, with a number of vineyards and cider producing orchards dotted throughout the region.
This publication has been prepared by RRL LLP. It is to be treated as a general guide only and is not intended to be a comprehensive statement of the law or represent specific tax advice. No liability is accepted for the opinions it contains, or for any errors or omissions. All rights reserved.