Inheritance tax (IHT) receipts for April to December 2024 reached £6.3bn, marking a £0.6bn increase from the same period last year. HMRC data highlights the steady rise in IHT over recent years, reaching record highs.
The Office for Budget Responsibility (OBR) forecasts IHT receipts will reach £8.3bn in 2024-25, rising to £13.9bn by 2029-30. Andrew Tully, technical services director at Nucleus, noted that the OBR’s £8.3bn estimate for 2024-25 represents a 10.7% increase from last year. He attributes this growth to policy changes, including restrictions on agricultural and business reliefs and the extended freeze on nil-rate bands until 2029-30.
Additionally, the government’s consultation on including pensions within the estate for IHT purposes from April 2027 closes today. If implemented, this change could further drive up receipts, potentially doubling them by 2029-30 compared to 2022-23 levels.
Alastair Black, head of savings policy at Abrdn, warned that HMRC’s consultation on calculating and paying IHT on pensions highlights the complexities involved. He emphasized that delays in inheritance payments could impact all estates, regardless of size, as additional administrative requirements may slow down pension and estate payouts, affecting beneficiaries at a vulnerable time.
