Lasting Power of Attorney Fee Increases and Business Property Relief Changes
Lasting Power of Attorney Fee Increases and Business Property Relief Changes: What Families and Business Owners Need to Know in 2025
Two major legal and tax changes are set to affect families across England and Wales. First, the cost of applying for a Lasting Power of Attorney (LPA) will increase in November 2025. Second, the long-standing rules on Business Property Relief (BPR), a cornerstone of inheritance tax planning for entrepreneurs and landowners, will be fundamentally reformed from April 2026.
At Garner & Hancock, we specialise in advising families and business owners on estate planning. Below, we explain what the changes mean in practical terms and why acting early could make a significant difference.
Increase in Lasting Power of Attorney Application Fees
The Ministry of Justice has confirmed that from 17 November 2025:
• The application fee for each LPA will rise from £82 to £92.
• The reduced fee (available for applicants on low income or certain benefits) will also increase.
For most couples, this change is not trivial. Each person usually prepares two LPAs (Property & Financial Affairs and Health & Welfare), meaning four applications in total for a household. The fee increase will therefore add an extra £40 to the cost.
Why this matters: LPAs are crucial legal documents that allow trusted people to step in if you lose capacity. Delaying applications until after November 2025 simply means paying more for the same protection.
Business Property Relief (BPR) Changes from April 2026
For decades, Business Property Relief has been a vital inheritance tax (IHT) exemption. It has allowed family businesses and certain investments (including AIM shares) to be passed on at death free from IHT, in many cases with up to 100% relief.
That landscape is changing:
• From April 2026, BPR and Agricultural Property Relief (APR) will be capped.
• Large family enterprises will no longer be able to pass businesses tax-free. Instead, a 20% IHT charge will apply to the value of the business above £1 million.
• HMRC estimates around 2,000 more estates will face higher tax bills.
The impact in practice
• Family businesses worth tens of millions could face multi-million-pound tax charges unless action is taken.
• Many business owners are already restructuring ownership, gifting assets to children, or using trusts before the deadline.
• Farmers have staged protests in London, warning that these changes threaten jobs and investment.
Planning opportunities
• Lifetime gifting: Transfers made more than 7 years before death are free of IHT.
• Trust structures: Though subject to new charges, trusts can still spread liabilities and provide succession control.
• Life insurance: Policies written into trust can provide heirs with liquidity to pay IHT bills without forced sales.
Why You Should Act Now
• LPA fees: Apply before 17 November 2025 to avoid unnecessary extra costs.
• BPR: Business owners should review structures urgently, ahead of the April 2026 deadline. Delaying could mean significant tax exposure for the next generation.
How Garner & Hancock Can Help
Our team advises on estate planning, cross-border inheritance issues, and complex tax matters. We can help you:
• Prepare LPAs cost-effectively before the fee rise.
• Assess your business or investment portfolio in light of the new BPR rules.
• Explore gifting, trust, and succession options tailored to your family.
Contact us today to secure your family’s future and protect against unnecessary tax burdens.
