Worthy tax planning at Glastonbury’s Worthy Farm

Michael Eavis, the founder of Glastonbury Festival, has made headlines this week after The Times reported that he’s transferred his shares in the festival’s operational company to his daughter, Emily, and has gifted most of his shares in the festival’s holding company into a family trust. This move happened just before the government’s Autumn Budget announcement in October 2024.

Thanks to some clever advice, this planning could save Michael’s estate up to £80 million in inheritance tax (IHT). This article explains why the timing of these changes is so important and what other business owners and farmers can learn from it before the new tax rules come into effect on 6 April 2026.

What is IHT and why do IHT reliefs matter?

IHT is usually paid when someone dies although it can also arise on certain lifetime gifts, and on an ongoing basis on trust property. On death, it’s charged at 40% on anything above the tax-free allowances — unless certain reliefs apply.

Two key types of relief can reduce or eliminate this extremely unpopular tax:

1. Business Relief: This applies to shares in private companies (like Glastonbury Festival’s companies) if: 
   • The business is actively trading (not just holding investments)
   • The shares have been owned for at least two years
     
     
2. Agricultural Relief: This applies to farmland, either: 
   • Owned and farmed by the person (or their spouse) for at least two years
   • Owned for seven years if farmed under a farming business tenancy

When considering the availability of business relief, the law ignores any part of the value of the business that is attributable to "excepted assets", and for a more detailed look at the risk of excepted assets for festival owners, have a read of our article on The risky business of festivals. Let’s hope that Michael sought a ruling from HMRC in advance of making the gifts, to confirm business relief applied in full!

Prior to the Budget, if the conditions for either relief were met, then the relief was unlimited, making the reliefs hugely valuable. If Michael had continued to hold his company shares at the date of his death and the requirements for business relief were satisfied, there would have been no IHT charged on the value of those shares at all. Equally, assuming it qualified for agricultural relief in full, then there would have been no IHT on Worthy Farm.

Budget reforms

From 6 April 2026, the government is restricting the availability of business and agricultural relief. A more detailed explanation of the Budget changes to IHT mentioned in our article: Autumn Budget 2024: Changes to APR and BPR.

The key points to note, in connection with the timing of Michael’s gifts, are that because he made them prior to the Budget announcement:

• £1 million business relief allowance: His family trust, that now owns the shares in his holding company, will benefit from its own £1 million allowance. For any trusts created by same settlor after the Budget, the £1m allowance will be divided between them.
• Clawback: If Michael fails to survive seven years from the date of the gifts, then provided Emily and the trustees are still holding those shares at the date of Michael’s death, IHT relief will continue to apply. If Michael had made the gifts after the Budget and died within seven years, then they would have trigged an IHT charge, regardless of whether the shares were still held by Emily or the trustees.

Although the timing of these gifts was fortuitous (or perhaps the result of some very astute advice), that doesn’t mean that Michael’s shares will escape the IHT net entirely. Unless Emily undertakes her own estate planning in the future, approximately half of the value of the shares she has received will be subject to IHT at 40% on her death and the shares held in trust will continue to be subject to IHT every ten years, at a rate of broadly 3%, even if they continue to qualify for relief.
And as The Times notes, Worthy Farm, the land on which Glastonbury Festival is held each year, is still majority owned by Michael with only a fifth split among his children. The Budget restrictions to agricultural relief will therefore still have a negative impact on his overall IHT position unless he takes any further action.

What can others do?

Taking these steps prior to the Budget announcements has placed Michael, and those who set to benefit from his estate, in the best possible position as far as IHT on his Glastonbury shares goes. However, for those farmers and business owners who have not yet undertaken any estate planning, there’s still time to act before the new rules come into effect in April 2026.

• Gifts into trust: Shares qualifying for business or agricultural relief can continue to be transferred into trust before April 2026, without giving rise to an immediate IHT charge. Gifting shares into a family trust where you are appointed as one of the trustees (as Michael has done), enables you to retain control over the shares gifted into trust, and ensures that the shares are protected for your children and future generations of your family. They are also subject to the ‘relevant property IHT regime’, which can be favourable as this allows the trustees to plan for smaller, regular tax charges rather than large unexpected ones, which can arise on death.
• Outright gifts: Making outright gifts of assets qualifying for IHT relief to children or spouses can help to maximise the number of £1 million allowances available, once the relievable assets have been held for the requisite period of time. This might be something Michael wants to consider in relation to Worthy Farm.

And even after the reforms come into effect next April, when gifts of qualifying shares or farmland into trust will give rise to an immediate IHT charge, there continues to be planning opportunities available, particularly for those where a sale of a business is envisaged. The widening of the interest free instalment options for the payment of IHT will also help those who have to raise the funds to meet the tax. Regardless of whether families wish to make gifts now, proper advice is key.

Other things to think about

Glastonbury Festival responded to The Times that it and Michael Eavis have always been happy to pay their fair share of tax. And it’s important to stress that tax shouldn’t be the only reason for estate planning.

Other important factors include:

• Continuity of the farm or business: Reducing the potential IHT exposure reduces the risk of farms or businesses needing to be sold to foot an IHT bill. For Glastonbury and the Eavis family, an £80m inheritance tax charge would come with a huge operational impact, even if they chose to pay in annual instalments over ten years.
• Protection and control: Who should receive gifts, and how they should receive them (whether outright or in trust), needs careful thought. It’s interesting that Michael has chosen to make outright gifts of his shares in the Glastonbury operating company to Emily rather than these gifts being made into trust for her benefit. An outright gift naturally gives rise to greater risks in the event of divorce or financial difficulties but is perhaps in this case reflective of his long-term succession plan to pass complete control of the festival over to Emily. 

Overall, Michael Eavis’ forward-thinking estate planning provides a great example into how to navigate the complicated and ever-changing IHT landscape. For other business owners and farmers, there’s still a window of opportunity to act before April 2026 — but it’s closing fast.

If you would like to explore estate planning opportunities following the Budget announcements in more detail, do get in touch with your usual Mills & Reeve contact.