What is Inheritance Tax? Complete Guide 2025
Inheritance tax (IHT) is a UK tax charged at 40% on the value of an estate above the nil-rate band when someone dies. For 2025/26, the nil-rate band is £325,000 per person.
Not all estates pay IHT. Transfers between spouses are exempt, and the residence nil-rate band can raise the threshold for those leaving a family home to children. Reliefs for business and agricultural assets can reduce or eliminate IHT for qualifying estates.