The Government collected £1.5 billion in inheritance tax (IHT) receipts in the first two months of the tax year. The latest data, published by HM Revenue and Customs (HMRC), confirmed that the total sum was £98 million higher than the previous tax year. This continues the upward trend of recent years.
If you are inheritance tax planning in Cheshire or elsewhere in the UK, it is worth noting that the Chancellor, Rachel Reeves, is said to be looking at further changes to duties paid by non-doms (non-domiciled) on global assets.
Since the new government came to power in 2024, the Office for Budget Responsibility (OBR) estimated that the new policy on non-doms would bring in around £215 million in revenue. In April, global assets became subject to a 40% inheritance tax, which has been attributed with slowing down the central London prime property market.
In response, Reeves has, according to the Financial Times, been considering making adjustments to current rules. However, the Treasury insists that the UK is still highly attractive, with a capital gains tax rate lower than leading European competitors, and a simpler residence-based regime offering greater appeal than its predecessor.
Analysts are expecting IHT receipts to continue their rise as the Government caps Agricultural Property Relief and Business Relief, while contribution pensions are poised to fall in April 2027 as people passing down wealth are impacted. People in this situation are being urged to mitigate IHT by ‘gifting’ in order to reduce beneficiaries’ exposure to tax – and the sooner the better, in case HMRC extends the ‘seven year rule’ on larger gifts.
