Inheriting land can be both an exciting opportunity and a significant responsibility. Whether you’ve inherited farmland, a development plot, woodland, garden land or an unused parcel of land, deciding what to do next isn’t always straightforward.
Unlike inheriting a house, land often requires less day-to-day maintenance, but it can still entail legal obligations, ongoing costs, and tax considerations. It may also have untapped development potential that could significantly increase its value.
Before making any decisions, it’s important to understand exactly what you’ve inherited, what it’s worth and the options available to you.
In this guide, we’ll explain everything you need to know about inheriting land in the UK, including planning permission, tax implications, legal responsibilities and how to decide whether to keep, develop, lease or sell your inherited land.
What happens when you inherit land?
When someone leaves land to you in their will, ownership doesn’t automatically transfer on the day they pass away. Before the land can legally become yours, the estate will usually need to go through probate.
During probate, the executor or administrator of the estate identifies all assets and liabilities, settles any outstanding debts and distributes the remaining assets according to the will or the rules of intestacy if there isn’t one.
Once probate has been completed, ownership of the land can usually be transferred into your name through HM Land Registry.
If there are multiple beneficiaries, the land may initially be jointly owned until everyone agrees on what should happen next.
The first question to ask: What type of land have you inherited?
Not all land is the same, and understanding what you’ve inherited should be your first priority.
Different types of land have very different values, legal restrictions and future opportunities.
For example, agricultural land is primarily valued for farming, while brownfield land may have significant redevelopment potential. Garden land attached to residential property can sometimes be developed, whereas Green Belt land is subject to much stricter planning controls.
The most common categories include:
- Agricultural land
- Green Belt land
- Brownfield land
- Woodland
- Garden land
- Commercial land
- Development land
Understanding the classification of the land will help determine its current value, potential uses and whether development could be possible in the future.
If you’re unsure, a chartered surveyor or land agent can usually identify the land type and provide an initial valuation.
How much is inherited land worth?
Many people assume that larger plots are automatically worth more.
In reality, location and planning potential usually have a much greater impact on value than size alone.
Factors affecting value include:
- The location of the land
- Accessibility
- Existing services and utilities
- Planning permission
- Local housing demand
- Environmental restrictions
- Existing buildings
- Agricultural quality
- Future development potential
Two seemingly identical fields can have dramatically different values simply because one sits next to an expanding village while the other is located in protected countryside.
Obtaining an independent valuation before making any decisions is highly recommended.
Planning permission can completely change the value of inherited land
Perhaps the single most important factor affecting inherited land is whether it has planning permission.
Agricultural land in the UK may typically sell for around £8,000–£12,000 per acre, depending on location and quality.
However, the same land with planning permission for residential development could be worth hundreds of thousands—or even several million pounds per acre.
This means planning permission can increase the value of land many times over.
Before selling inherited land, it’s important to understand its planning status.
Green Belt land
Green Belt land is protected from most forms of development in order to prevent urban sprawl.
Obtaining residential planning permission is generally much more difficult, although certain types of development may still be permitted.
Brownfield land
Brownfield land has previously been developed.
Government planning policy generally encourages redevelopment of these sites, meaning planning permission may be easier to obtain compared with undeveloped land.
Agricultural land without planning permission
Agricultural land usually has a lower market value.
However, if it’s located close to an existing town or village, speaking with a planning consultant before selling could be worthwhile.
A relatively inexpensive planning assessment could reveal development opportunities that significantly increase the land’s value.
For many landowners, this is one of the most valuable pieces of advice they receive.
Should you keep inherited land?
Keeping inherited land can be a sensible long-term investment.
Land is a finite resource and has historically increased in value over time, particularly where nearby housing or infrastructure developments create additional demand.
Some people retain inherited land because it has sentimental value, while others see it as an investment for future generations.
However, owning land isn’t entirely passive.
Even unused land requires management and ongoing maintenance.
Before deciding to keep it, consider whether you’re willing to take on those responsibilities over the coming years.
Can you build on inherited land?
Many people inherit land and immediately begin thinking about building their own home.
Whether this is possible depends entirely on planning permission.
Even if permission hasn’t already been granted, it may still be possible to submit a planning application.
Factors such as road access, flood risk, protected habitats, local planning policies and neighbouring developments will all influence whether permission is likely to be approved.
Building your own property can be rewarding, but it also requires considerable investment, professional advice and careful project management.
If you believe the land has development potential, obtaining planning advice before selling is often worthwhile.
Can you lease inherited land?
Selling isn’t the only option.
Depending on the type of land, leasing it may provide a regular source of income while allowing you to retain ownership.
Agricultural land is often rented to neighbouring farmers, while commercial land may be suitable for storage, renewable energy projects or telecommunications equipment.
Before entering into any agreement, it’s advisable to obtain legal advice so that your interests are properly protected and the lease reflects the market value of the land.
What responsibilities come with owning inherited land?
Although land generally requires less maintenance than residential property, there are still ongoing responsibilities.
Owners are usually responsible for maintaining boundaries, controlling vegetation, preventing fly-tipping where possible and ensuring that any structures on the land remain safe.
You may also wish to arrange public liability insurance, particularly if there is any possibility of members of the public accessing the land.
Looking after inherited land properly helps preserve its value and reduces the likelihood of future legal issues.
Rights of way, covenants and legal restrictions
Not every issue affecting inherited land is visible when you first visit it.
Some plots are affected by legal rights or restrictions that can influence both their value and future use.
For example, there may be public rights of way crossing the land, allowing members of the public to legally pass through it.
Restrictive covenants may prevent certain types of development or commercial activity.
The land could also benefit from—or be burdened by—easements that allow neighbouring properties access to roads, drainage or utilities.
Before making any decisions, ask your solicitor to review the title documents and explain any legal restrictions affecting the land.
Understanding these early can prevent unexpected problems later.
Agricultural Property Relief (APR)
If you’ve inherited farmland, you may benefit from an important Inheritance Tax relief known as Agricultural Property Relief (APR).
APR can reduce the taxable value of qualifying agricultural land by 50% or even 100%, potentially saving beneficiaries a substantial amount in Inheritance Tax.
To qualify, the land generally needs to have been used for agricultural purposes for at least two years if occupied by the owner, or seven years if it was let to a tenant.
It’s also important to understand that APR normally applies to the agricultural value of the land rather than any additional value arising from development potential.
If you’ve inherited agricultural land, seeking advice from a solicitor or tax adviser before selling is highly recommended, as APR can have a significant impact on the overall tax position of the estate.
Do you pay tax when inheriting land?
One of the biggest concerns for beneficiaries is whether inheriting land creates an immediate tax bill.
Inheritance Tax
Inheritance Tax is usually paid by the estate before assets are distributed to beneficiaries.
Whether tax is due depends on the overall value of the estate and the available tax-free allowances.
In many cases, beneficiaries receive their inheritance after these matters have already been dealt with by the executor.
Capital Gains Tax
Although inheriting land doesn’t usually create a Capital Gains Tax liability, selling it later may do so.
Capital Gains Tax is generally based on the increase in value between the probate valuation and the eventual sale price.
If the land has increased in value during that period, tax may become payable on the gain.
Professional tax advice is recommended before selling valuable land.
What happens if there’s a loan secured against the land?
Although less common than residential mortgages, some land does have loans or legal charges secured against it.
These debts don’t automatically disappear when someone dies.
During probate, the executor will establish what money is owed and determine how it should be repaid.
If there aren’t enough assets within the estate to settle the borrowing, the beneficiary may need to decide whether to repay the debt, refinance it or sell the land.
Understanding any borrowing secured against the land is an important part of the probate process.
What if you can’t find a buyer?
Selling land is often more difficult than selling a house.
The pool of buyers is much smaller, and many purchasers are looking for very specific opportunities such as development sites, agricultural land or commercial investments.
Land without planning permission or located in remote areas may remain on the market for longer than residential property.
If you’re struggling to find a buyer, obtaining an updated valuation, investigating planning opportunities or speaking with a specialist land agent may help improve your chances of achieving a successful sale.
Patience is often required, particularly where the land has niche appeal.
How do you decide whether to keep or sell inherited land?
Every inheritance is different, so there isn’t a single correct answer.
If the land has long-term development potential or significant sentimental value, keeping it could prove worthwhile.
If ongoing maintenance costs are becoming burdensome, multiple beneficiaries are involved or you simply have no plans to use the land, selling may be the more practical solution.
Before making a decision, consider the land’s current value, future potential, maintenance costs, legal obligations and tax position.
Taking independent advice from a solicitor, chartered surveyor, planning consultant or tax adviser can help you make an informed choice.
Frequently Asked Questions
Can I sell inherited land before probate?
In most cases, the sale cannot complete until probate has been granted. However, it is often possible to begin marketing the land before probate is finalised.
Can inherited land increase in value?
Yes. Land values can increase significantly over time, particularly if planning permission is granted or nearby development creates additional demand.
Do I need to register inherited land?
Once ownership has transferred, HM Land Registry should normally be updated to show you as the new legal owner.
Can I build a house on inherited land?
Possibly. Whether you can build depends on local planning policies, the type of land and whether planning permission is granted.
Is inherited land difficult to sell?
It can be. The market for land is generally smaller than the housing market, and sales often take longer because buyers typically have specific requirements or development plans.
Conclusion
Inheriting land can provide exciting opportunities, but it also comes with important financial, legal and practical responsibilities. Before deciding whether to keep, develop, lease or sell the land, it’s worth understanding its planning status, any legal restrictions, ongoing maintenance requirements and potential tax implications. Taking the time to obtain professional advice from a solicitor, chartered surveyor, planning consultant or tax adviser can help you understand the land’s true value and avoid costly mistakes. By carefully assessing both its current worth and future potential, you’ll be in the best position to make a decision that suits your circumstances and long-term goals.
