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Inheritance Tax Thresholds

Inheritance tax thresholds are set bands of worth applied to the estate of a recently deceased individual to assess whether the assets are liable for the tax.  Inheritance tax thresholds are a concern for many UK households because rising house prices have not been matched with equal rises in the thresholds, and as a result an increasing number of homeowners have to worry that their estates will be worth enough to be taxed after they pass away.

Inheritance tax thresholds can be broadly defined as follows:

  • The nil-rate band of £312,000 is a threshold below which an estate is not subject to inheritance tax.
  • Any worth in excess of the £300,000 threshold is taxed at a 40% rate.
  • There are many exemptions and conditions that can be applied to assets that can lower the taxable value of an estate.
  • Gifts made and assets transferred in the last seven years are 'potentially exempt transfers', and are counted towards the value of the estate although the tax rate on them decreases over time until they become exempt if the individual survives for seven years after giving them.

You can fill out our online enquiry form to get a free, no-obligation first consultation from a group of professional UK financial consultants if you are concerned that inheritance tax thresholds might mean your estate will be subject to inheritance tax.

Disclaimer: Every effort is made to keep the site accurate, however please bear in mind that tax rates are subject to change. If you require tax advice you should speak to a professional tax adviser.