Inheritance tax receipts hit £0.8 billion last month according to data released by HM Revenue and Customs.
That’s £97m higher than in April of the previous tax year, and continues an upward trend over the last two decades.
With such a strong start to the new tax year, analysts forecast that Inheritance tax receipts could top the £8.2 billion raised in the 2024/25 tax year.
Office for Budget Responsibility estimates suggest nearly 10% of estates will pay death duties by 2030 due to increasing house prices, changes to inheritance tax rules and years of allowance freezes.
Nicholas Hyett, Investment Manager at Wealth Club, says: “Over the last 20 years the inheritance tax tab has increased from £3.3 billion to £8.2 billion. With such a strong start to the 2025/26 tax year this is only going one way – and that is up.
“This is no accident – leaked government documents made it clear this week that inheritance tax is still seen as a cash cow by some members of the cabinet.
“The government’s raids on historically IHT free investments and assets – like pensions, private company shares and AIM shares – create exactly the kind of uncertainty that puts people off making investments.”
And Ian Dyall, Head of Estate Planning at wealth management firm Evelyn Partners, comments: “What has stirred up some interest in the Government’s intentions for IHT – aside from those announced at the October Budget – is the memo from the Deputy Prime Minister to the Chancellor leaked this week.
“That called for – among other tax rises – IHT relief on AIM shares to be removed altogether, which would go further than the current cut to 50% due for April 2026, and would save the Treasury £1 billion.
“Whether this suggestion carries any weight with the Chancellor is unknown, but with the PM also rowing back on cuts to the Winter Fuel Allowance this week, questions are bound to arise around tax if the fiscal outlook doesn’t improve before the Autumn Budget.
“Some in Government obviously see the passing on of estates as a legitimate target for tightening up the tax net, so whether or not there are any changes to IHT reliefs at the next Budget, it would be surprising if we got to the next election without any.”
This article is taken from Landlord Today