It’s no secret that Brits love a restorative escape. Since the Victorian era, when ‘taking the air’ at the seaside was promoted as a curative break, retreats to both the coast and countryside have become a national tradition. But could the classic staycation now be at risk?
Many holiday parks could struggle to survive a hefty Inheritance Tax (IHT) bill, which is a concern for more and more park owners - especially as April 2026 draws closer.
A recent report by the British Holiday & Home Parks Association estimates that Inheritance Tax reforms could cost the parks sector over £130 million in direct economic contribution and lead to the loss of 3,000 jobs, with up to 5,300 jobs affected across connected industries in coastal and rural communities.
From April 2026, Agricultural Property Relief (APR) and Business Property Relief (BPR) will remain at 100% for qualifying assets up to £1 million. Beyond that threshold, however, relief drops to 50%, which means that a 20% inheritance tax rate applies to the excess. The government says most small businesses will manage, but industry bodies disagree. Some warn that up to 200,000 jobs could be at risk across multiple sectors, including leisure and tourism.
Holiday and campsite businesses are often multigenerational, wherein this amended levy could pose significant problems. Let’s look at a recent example from the BBC - take Ian James of Coast and Country Holiday Parks along England’s South West regions. He runs four coastal sites and hopes to pass them to his son. Now, with upcoming Inheritance Tax changes on the horizon, he may have to sell half of them just to cover the levy. It highlights the fragile balance between preserving a legacy and meeting changing tax demands.
According to the UK Caravan and Camping Alliance, there are around 1,677 operators managing almost 3,000 parks and nearly 390,000 pitches. Visitor spending tops £12 billion annually, supporting over 226,000 full-time jobs.
Clearly, this is no marginal industry, but it’s also one increasingly under pressure. Post-pandemic, demand did indeed bounce back, but ever-rising energy costs, staffing shortages and cost-of-living pressures continue to bite down firmly on this family-favourite industry. Now, this hotly contested tax reform threatens to strip businesses of both stability and tradition.
So, what can park owners do?
First, it’s important to act now. The key idea is that succession planning shouldn’t be treated as a one-off event when the current owner retires or passes away. Instead, it should be approached as a gradual transition, wherein ownership, operational responsibilities, and governance are gradually transferred to the next generation.
Acting early allows families to structure the business efficiently, reduce exposure to Inheritance Tax, and avoid operational disruption. Delaying the process increases the risk of disputes, forces rushed decisions under pressure, and can lead to unnecessary costs or even the forced sale of assets, particularly under the upcoming IHT changes affecting business property.
The structure of a business or estate is central to how much inheritance tax relief can be claimed. Ownership arrangements, whether held individually, jointly, through a company, or in a trust, determine which assets qualify for Business Property Relief or Agricultural Property Relief.
With the upcoming reforms, even assets held in trusts are now subject to the new £1 million cap, so previously reliable strategies may no longer fully protect a family business.
Now’s the time to revisit ownership structures or consider phased gifting to help optimise the relief available, but clarity is crucial. Without a clear plan, families risk unexpected tax bills, operational disruption, or having to sell parts of the business to offset liabilities. Thoughtful, proactive structuring ensures that succession can be managed smoothly and the next generation is well prepared to take over.
Documentation is key to a smooth succession. A detailed Will, partnership or shareholder agreement, and power of attorney ensure that everyone understands who owns what and who is responsible for running the business.
These documents should be regularly reviewed, particularly after major life or business events, such as land sales, diversification, or changes in family circumstances. Clear, up-to-date records reduce the risk of disputes, avoid unnecessary tax liabilities, and make it easier for the next generation to manage the business confidently.
Prepare the next generation, not just the assets they’ll be managing. Passing on a business successfully means transferring knowledge, skills, and leadership as well as ownership.
Successors need experience in areas such as financial management, regulatory compliance, and operational oversight to run the business effectively. Supporting them with training, mentorship, and practical exposure ensures they are ready to take the reins and helps preserve long-term stability and culture.
Yes, the Inheritance Tax changes could force hard choices, but holiday parks do more than generate profits. They employ locals, boost regional economies and sustain rural communities. A family’s connection often spans decades of service - and is supported by an innate ethic of care, not solely commerce.
Owners who act early stand a far better chance of preserving what makes their business special. Duncan & Toplis is working closely with park owners to build transition plans grounded in real-world realities and business values.
Act now to protect your family, your business, and your legacy - contact us today.
