In most cases, if you are married or in a registered civil partnership, you can pass on your assets to your partner Inheritance Tax-free. The surviving partner can then claim both tax-free allowances. If the first person to die leaves all of their assets to their surviving spouse, the surviving spouse will be entitled to an Inheritance Tax allowance of £650,000 (£1 million if they qualify for the RNRB). According to HM Revenue & Customs (HMRC) data, more estates in the UK are now paying Inheritance Tax than ever before[1].

PAYING INHERITANCE TAX UNEXPECTEDLY

Inheritance Tax receipts totaled £6.1 billion in the fiscal year 2021/2022, an increase of £729 million over the previous year. This 14% increase is the highest one-year increase in Inheritance Tax receipts since the 2015/16 fiscal year. The growth is the the ongoing freeze on the nil-rate Inheritance Tax band and the residence nil-rate Inheritance Tax band.

Many more families are discovering that the total value of their estate, as a result of rapid growth in house prices, savings, and other assets, is likely to be greater than £1 million at the time of death, implying that many more estates may be liquidated and Inheritance Tax may be due unexpectedly.

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Source data: [1] https://www.gov.uk/government/statistics/inheritance-tax-statistics-commentary/inheritance- tax-statistics-commentary