Inheritance Tax

Changes to Agricultural and Business Property Relief reforms

The government recently announced significant changes to the planned reforms to Agricultural Property Relief (APR) and Business Property Relief (BPR). The threshold for 100% relief will be increased from £1 million to £2.5 million when the changes

Agricultural and business property relief changes

Agricultural and business property relief changes that were first announced at Autumn Budget 2024 will come into effect from 6 April 2026. These measures will introduce significant reforms to Business Property Relief (BPR) and Agricultural Property

IHT treatment of unused pension funds and death benefits

The 2027 reforms will shift more responsibility to personal representatives, who may need to manage withholding arrangements and settle any IHT before pension benefits are released.

From 6 April 2027, most unused pension funds and death benefits

Inheritance Tax and CGT relief for national heritage assets

Certain buildings, land, works of art, and other objects of national significance may be exempt from Inheritance Tax and Capital Gains Tax (CGT) when they are transferred to a new owner. This exemption applies under a special tax relief for national

Gifts with reservation of benefit

Gifting assets can cut inheritance tax, but traps like “gifts with reservation of benefit” may undo the plan.

The majority of gifts made during a person’s lifetime are not subject to tax at the time they are made. These lifetime

Unused pension funds and IHT from April 2027

From 6 April 2027, new measures first announced in the Autumn Budget 2024 will come into force. These changes will bring most unused pension funds and death benefits into the scope of Inheritance Tax (IHT) from April 2027. This represents a major

Trusts and Income Tax

Trustees must manage assets, follow tax rules, and register with HMRC where required.

A trust is a legal arrangement in which a trustee, either an individual or a company, is entrusted with managing assets such as land, money, or shares on behalf of

Who can claim the IHT residence nil rate band

With the Residence Nil Rate Band (RNRB), families can pass on up to £1 million without IHT

The RNRB is an additional £175,000 Inheritance Tax (IHT) allowance that applies when a person’s main residence is passed to a direct descendant, such as a

Estate valuation for IHT purposes

Before probate begins, you must estimate the estate’s value to see if Inheritance Tax applies. This includes valuing the deceased person’s money, property and belongings in order to determine if Inheritance Tax (IHT) is due. This process is important

Current Inheritance Tax thresholds

Married couples can pass on up to £1 million tax-free if they plan their estates carefully.

The Inheritance Tax (IHT) nil-rate band is currently £325,000. This means there is normally no IHT to pay if an estate is valued below this threshold. This

IHT Agricultural and Business Property Relief changes confirmed

Despite intense lobbying by the farming community, the proposed reduction in IHT Business and Agricultural Property reliefs are included in the draft Finance Bill 2025-26.

On 21 July 2025, the government published draft legislation for Finance Bill

IHT Unused Pension Funds and Death Benefits changes

It was confirmed with the publication of the draft Finance Bill 2025-26 that measures first announced in the Autumn Budget 2024 to bring most unused pension funds and death benefits into the scope of Inheritance Tax (IHT) will start from 6 April

Double Tax Conventions and IHT

Double tax on estates can still hit families hard, even with treaties in place. When someone dies with ties to more than one country, their estate may face inheritance tax in both jurisdictions. Fortunately, the UK has Double Taxation Conventions

Current IHT gift reliefs

Lifetime gifts can reduce Inheritance Tax, but survival for seven years and using key exemptions like the £3,000 annual allowance are crucial to making them fully tax-free.

Most gifts made during a person’s lifetime are not immediately subject to

IHT exemption – normal expenditure out of income

Make regular gifts from your income and avoid inheritance tax. If structured properly, surplus income gifts can support loved ones and stay outside your estate without the seven-year survival rule.

Wealthier individuals can benefit from a

Changes to IHT from April 2025

From April 2025, Agricultural Property Relief from Inheritance Tax now extends to land under qualifying environmental agreements. This means landowners entering long-term stewardship schemes will not lose IHT relief. From April 2026, a new £1 million

Probate waiting times halved

The Ministry of Justice (MOJ), together with HM Courts & Tribunals Service (HMCTS) and the Minister for Courts and Legal Services, has announced significant improvements in probate waiting times. Probate is a legal process through which a

Gifts exempt from Inheritance Tax

Navigating the intricacies of Inheritance Tax (IHT) can be daunting, but understanding the available gift exemptions and strategic planning can significantly reduce potential liabilities. By effectively utilising annual allowances, small gift

Tax chores if managing a deceased person’s estate

When someone dies, their personal representative (executor or administrator) must value their estate to determine if Inheritance Tax (IHT) is due. This involves assessing assets, debts, and handling tax obligations throughout the estate’s

Tax return for deceased person

Inheritance Tax (IHT) impacts estates over £325,000, with rates of 40% on death and 20% on certain gifts. A 36% reduced rate applies if 10% of the estate is left to charity. Executors must value estates and may need to file tax returns for the

Inheritance Tax thresholds and the RNRB

Inheritance Tax nil-rate bands remain frozen until April 2030. Learn how this affects estates, the residence nil-rate band, and planning opportunities to maximise tax-free inheritance for loved ones.

The Inheritance Tax (IHT) nil-rate bands have

IHT nil rate band reduction for large estates

Married couples and civil partners may be able to pass on up to £1 million of their estate tax-free with the Residence Nil Rate Band. Claiming this transferable allowance could secure your family home for future generations. Make sure your estate

Seven year rule still applies – IHT PETs

There are specific rules regarding the liability to Inheritance Tax (IHT) on gifts made during a person’s lifetime. In most cases, gifts made during a person’s life are not taxed at the time they are given.

These lifetime gifts are referred to as

What is a discretionary trust?

A trust is an obligation that binds a trustee, an individual or a company, to deal with assets such as land, money and shares and which form part of the trust. The person who places assets into a trust is known as a settlor and the trust is for the

Changes to Agricultural and Business Property Relief

It was announced as part of the Budget measures that the government will reform these reliefs from 6 April 2026. The existing 100% rates of relief will be maintained for the first £1 million of combined agricultural and business property. The rate of

Autumn Budget 2024 – Inheritance Tax changes

A number of changes to Inheritance Tax (IHT) were announced as part of the Budget measures. We have covered each of the main measures below. It should be noted that these changes are not coming into effect until April 2026 at the earliest.

IHT

Gifts and Inheritance Tax

Most gifts made during a person’s lifetime are not subject to tax at the time of transfer. These gifts, known as "potentially exempt transfers" (PETs), can become fully exempt if the donor survives for more than seven years after making the

IHT unused Residence Nil Rate Band (RNRB)

The Inheritance Tax Residence Nil Rate Band (RNRB) is a transferable allowance available to married couples and civil partners when their main residence is inherited by direct descendants, such as their children or grandchildren.

The RNRB is

What qualifies for IHT Business Relief

There are several types of reliefs from Inheritance Tax (IHT), one of which is IHT Business Relief. This can be a significant tax benefit for those with business interests, potentially offering either 50% or 100% relief from IHT on the value of

Considering a significant gift?

There are special rules concerning the liability to IHT of a transfer made during one’s lifetime. For example, most gifts made during a person’s life are not subject to tax at the time of the gift. These lifetime transfers are known as ‘potentially

Inheritance and tax

As a general rule, an individual who inherits property, money or shares is not liable to pay tax on the inheritance. This is because any Inheritance Tax (IHT) due should be paid out of the deceased’s estate before any cash or assets are distributed

Transferring unused IHT residence nil rate band

The Inheritance Tax residence nil rate band (RNRB) is a transferable allowance for married couples and civil partners (per person) when their main residence is passed down to a direct descendent such as children or grandchildren after their death.

Lifetime transfers and liability to IHT

There are special rules concerning the liability to IHT of a transfer made during a lifetime. For example, most gifts made during a person’s life are not subject to tax at the time of the gift. These lifetime transfers are known as ‘potentially

Transferring unused nil rate band for IHT

The Inheritance Tax residence nil rate band (RNRB) is a transferable allowance for married couples and civil partners (per person) when their main residence is passed down to a direct descendent such as children or grandchildren after their death.

IHT gifts – 7 year limit

Most gifts made during a person’s life are not subject to tax at the time of the gift. These lifetime transfers are known as ‘potentially exempt transfers’ or ‘PETs’. These gifts or transfers achieve their potential of becoming exempt if the taxpayer

Utilise your 2023-24 IHT reliefs

We wanted to remind you of the Inheritance Tax (IHT) implications of making cash gifts during the current 2023-24 tax year that will end on 5 April 2024.

You can give away up to £3,000 worth of gifts each tax year. This is known as your annual

IHT – Giving away your home before you die

The majority of gifts made during a person’s life, including gifting a home, are not subject to tax at the time of the gift. These lifetime transfers are known as ‘potentially exempt transfers’ or ‘PETs’. These gifts or transfers achieve their

Transferring IHT unused nil rate band

The Inheritance Tax residence nil rate band (RNRB) is a transferable allowance for married couples and civil partners (per person) when their main residence is passed down to a direct descendent, such as children or grandchildren, after their death.

What is a trust?

A trust is an obligation that binds a trustee, an individual or a company, to deal with assets such as land, money and shares which form part of the trust. The person who places assets into a trust is known as a settlor and the trust is for the

Giving money to charity in your Will

A reduced rate of Inheritance Tax (IHT) of 36% (reduced from 40%) applies where 10% or more of a deceased’s net estate is left to charity. The lower rate applies where 10% or more of the ‘net value’ of the estate is left to charity.

The current IHT

Characteristics of a valid Will

It is important to make a Will to ensure that your estate is divided amongst your beneficiaries in accordance with your wishes. If you do not leave a Will the law decides who inherits the estate. This can result in a distribution of assets that would

Transfer of unused IHT nil rate band

The Inheritance Tax residence nil rate band (RNRB) is a transferable allowance for married couples and civil partners (per person) when their main residence is passed down to a direct descendent such as children or grandchildren after their death.

Overview of IHT agricultural relief

There are a number of reliefs available that can reduce liability to IHT. Of most interest to farmers is the Agricultural Property Relief (APR). Relief is available at a rate of 100% or 50% depending on who farms the land and how long the land has

Business Relief for IHT

There are a number of reliefs available that can reduce liability to Inheritance Tax (IHT).

One of these reliefs is known as IHT Business Relief and is a valuable tax relief for taxpayers with business interests, offering either 50% or 100% relief

Exempt gifts paid out of income

There is a flexible exemption from IHT for taxpayers who make tax exempt gifts and payments that are paid as normal expenditure out of income. With proper planning this can be a useful tool to enable grandparents, for example, to help pay school fees

Transferring nil rate band for Inheritance Tax

The Inheritance Tax residence nil rate band (RNRB) is a transferable allowance for married couples and civil partners (per person) when their main residence is passed down to a direct descendent such as children or grandchildren after their death.

Valuing an estate for IHT purposes

Inheritance Tax (IHT) is levied on a person’s estate when they die and can also be payable during a person’s lifetime on certain trusts and gifts. The rate of Inheritance Tax payable is 40% on death and 20% on lifetime gifts.

The current IHT nil

Making a claim on an unclaimed estate

There are special intestacy rules that govern how assets are divided if you die without making a will. If this happens your assets are passed on to family members in accordance with a set legal formula. This can result in a distribution of assets

Have you utilised 2022-23 IHT allowances and reliefs?

We wanted to remind you of the Inheritance Tax (IHT) implications of making cash gifts during the current tax 2022-23 tax year that will end on 5 April 2023.

You can give away up to £3,000 worth of gifts each tax year. This is known as your annual

Exempt transfers between siblings

Inheritance Tax (IHT) is levied on a person’s estate when they die and can also be payable during a person’s lifetime on certain trusts and gifts. The current IHT nil rate band is £325,000 per person, below which no IHT is payable. This is the amount

IHT – estimating an estate’s value

Inheritance Tax (IHT) is levied on a person’s estate when they die and can also be payable during a person’s lifetime on certain trusts and gifts. The rate of Inheritance Tax payable is 40% on death and 20% on lifetime gifts.

The current IHT nil

Tax on property you inherit

If you inherit property, you are usually not liable to pay tax on the inheritance. This is because any Inheritance Tax (IHT) due should be paid out of the deceased’s estate before any cash or assets are distributed.

The rate of IHT currently

Gifts paid out of disposable income

It is possible for wealthier taxpayers to make tax exempt gifts and payments that are funded as normal expenditure out of income. This is a very flexible exemption from IHT as there are no specific requirements, for example by making fixed regular

IHT claiming business relief

There are a number of reliefs available that can reduce liability to Inheritance Tax (IHT) if you inherit the estate of someone who had died.

One of these reliefs is known as IHT Business Relief and is a valuable tax relief for taxpayers with

IHT gifts with reservation of title

The majority of gifts made during a person’s life are not subject to tax at the time of the gift. These lifetime transfers are known as ‘potentially exempt transfers’ or ‘PETs’. These gifts or transfers achieve their potential of becoming exempt from

Changing a will after death

In certain circumstances, a will can be changed after death. This can be done by using what is known as a Deed of Variation. Any changes to the will must be done within two years from the date of death. However, beneficiaries who would be left worse

IHT Business Relief

There are a number of reliefs available that can reduce liability to Inheritance Tax (IHT) when you inherit the estate of someone who has died. One of these reliefs is known as IHT Business Relief and is a valuable tax relief for taxpayers with

Gifts with reservation

The majority of gifts made during a person’s life are not subject to tax at the time of the gift. These lifetime transfers are known as ‘potentially exempt transfers’ or ‘PETs’. These gifts or transfers achieve their potential of becoming exempt from

Qualifying for residence nil rate band

The Inheritance Tax residence nil rate band (RNRB) is a transferable allowance for married couples and civil partners (per person) when their main residence is passed down to a direct descendent such as children or grandchildren after their death.

Domicile and IHT

Domicile is a general legal concept which in basic terms is taken to mean the country where you permanently belong. But actually, determining domicile status can be complex. HMRC guidance states that domicile cannot be defined precisely, but the

IHT business asset relief

There are a number of reliefs available that can reduce liability to IHT if you inherit the estate of someone who had died. One of these reliefs is known as Business Relief and is a valuable tax relief for taxpayers with business interests, offering

Inheritance Tax-free gifts reminder

We wanted to remind our readers of the Inheritance Tax (IHT) implications of making cash gifts during the current 2021-22 tax year that will end on 5 April 2022.

You can give away up to £3,000 worth of gifts each tax year. This is known as your

Bare or simple trusts

A trust is an obligation that binds a trustee, an individual or a company to deal with the assets such as land, money and shares which form part of the trust. The person who puts assets into a trust is known as a settlor and the trust is for the

IHT – limitations on spouse or civil partner exemptions

Inheritance Tax (IHT) is a tax that is levied on a person’s estate when they die and can also be payable during a person’s lifetime on certain trusts and gifts. The rate of Inheritance Tax payable is 40% on death and 20% on lifetime gifts. There is

Leaving gifts to charity in your Will

The government introduced new rules to encourage charitable giving on death in 2012. The rule which has remained unchanged ever since means that a reduced rate of Inheritance Tax (IHT) of 36% (reduced from 40%) applies where 10% or more of a

IHT and domicile

Domicile is a general legal concept which in basic terms is taken to mean the country where you permanently belong but actually determining domicile status can be complex. HMRC guidance states that domicile cannot be defined precisely, but the

OTS recommended changes to IHT

The Financial Secretary to the Treasury has written to the Office of Tax Simplification (OTS) to confirm

Inheritance Tax – tax-free gifts

We wanted to remind our readers of the Inheritance Tax (IHT) implications of making cash gifts during the