Taxation of Environmental Land Management and Ecosystem Service markets.
As announced at Spring Budget 2024, the Government will introduce legislation in a future finance bill to extend the scope of agricultural property relief from Inheritance Tax to Environmental Land Management from 6 April 2025, following the consultation in 2023.
Relief will be available for land managed under an environmental agreement with, or on behalf of, the UK Government, Devolved Administrations, Public Bodies, Local Authorities, or approved Responsible Bodies. This includes agreements in place on or after 6 March 2024.
The government will also establish a joint working group between HM Treasury, HMRC, and industry representatives to identify solutions that provide clarity on the tax treatment of the production and sale of Ecosystem Service credits and associated units, where existing law or guidance may not provide sufficient clarity.
If you would like more in-depth information regarding this update, see the full publication below or head to https://www.gov.uk/government/consultations/taxation-of-environmental-land-management-and-ecosystem-service-markets.