The Inheritance Tax Revolution

Significant changes are coming to the UK's Inheritance Tax (IHT) system in April 2026. The reforms aim to boost tax revenues and tackle perceived inequalities, but they’ve already sparked concern among farmers, business owners, and for individuals with significant pension pots, investments and assets.

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Key changes to be aware of

Shift from Domicile to Residence-Based IHT

  • From 6 April 2025, the UK will shift to a residence-based IHT system, taxing long-term residents (10+ years in the UK) on their worldwide estate, with a "tail" provision keeping former residents within IHT scope for 3 to 10 years after leaving.

Agricultural and Business Property Reliefs (APR & BPR)

  • Currently there is a 100% relief from IHT on qualifying assets, however the reliefs will be capped and reduced from 6 April 2026, this will affect qualifying assets, AIM shares and Trusts.

Inclusion of Unused Pensions in IHT.

  • From 6 April 2027, unused pension pots and death benefits will be included in the deceased's estate for IHT purposes.

Freezing of IHT Thresholds

  • The IHT thresholds will remain frozen until 5 April 2030, despite rising asset values, which is expected to increase the number of estate liable for IHT.

Our report analyses seven years of data across 121 UK postcode areas, identifying key trends, future landscapes and expert opinion from our Private Client Advisory team.

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Andrea Jones
Andrea Jones
Partner & National Head of Private Client Advisory
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Whether you’re navigating separation, safeguarding your assets or planning for the future, our services are tailored for those who expect the highest standards - in legal precision, strategic thinking and personal support.

  • Inheritance tax planning

    Our Inheritance Tax solicitors can help you plan your estate’s inheritance tax so your loved ones can make the most of your assets, wealth, and property.

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    You may be concerned about who should benefit from your wealth and who’s best to take over the management of your assets, business or family trusts. Wealth planning will help you pass on your wealth in an organised way.

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