Epistasis is the principal non-additive genetic effect in inbred wheat lines and can be used to develop cultivars based on total genetic merit. Correct models for variance components (VCs) estimation are needed to disentangle the genetic architecture of complex traits in wheat. We aimed to i) evaluate the performance of extended genomic best linear unbiased prediction (EG-BLUP) and the natural and orthogonal interactions approach (NOIA) for VCs estimation in a commercial wheat-breeding population, and ii) investigate whether including epistasis in genomic prediction enhance predictive ability (PA) for wheat breeding lines. In total, 2,060 sixth-generation (F6) lines from Nordic Seed A/S breeding company were phenotyped for grain yield over 21-year-x-location combinations in Denmark, and genotyped using 15K Illumina-BeadChip. Four models were used to estimate VCs and heritability at plot level: i) Baseline, ii) Genomic best linear unbiased prediction (G-BLUP), iii) EG-BLUP, and iv) NOIA. Narrow- and broad-sense heritabilities estimated with G-BLUP were 0.15 and 0.31, respectively. EG-BLUP and NOIA failed to achieve orthogonal partition of genetic variances. Even though NOIA removed Hardy-Weinberg equilibrium assumption, both models yielded very similar estimates, indicating that linkage disequilibrium causes the lack of orthogonality. The PA was studied using leave-one-line-out and leave-one-breeding-cycle-out cross-validations. Both EG-BLUP and NOIA increased PA significantly (16.5%) compared to G-BLUP in leave-one-line-out cross-validation. However, the improvement for including epistasis was not observed in the leave-one-breeding-cycle-out cross-validation. We conclude that although the variance partition into orthogonal genetic effects was not possible, epistatic models can be useful to enhance predictions of total genetic merit.