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HMRC Warns of New Rule that Could See Brits 'Punished' with 40% Tax Bill

On August 9, 2025, HMRC issued a warning that thousands of UK households “may not realise” they are liable for inheritance tax.
With thresholds unchanged until at least 2030, the nil-rate band of £325,000 and residence nil-rate band of 175,000 remain static despite rising property values.
Regarding lifetime gifts, Lorraine Wilson, principal associate at Weightmans, noted that gifts made within seven years of death can still be taxed and explained the impact of the annual exemption versus the seven-year rule.
Last year, HMRC collected a record £7.5 billion from inheritance tax and advises individuals to plan early to avoid the 40% charge.
From 6 April 2026, Agricultural Property Relief will encounter significant limitations, reducing relief from 100% to a cap of 1 million per estate, HMRC warns.

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HMRC warns of new rule that could see Brits 'punished' with 40% tax bill

HMRC has warned that UK households could be hit with a 40% tax bill due to a rule that many people "may not realise" exists - and it applies to more people than you think

3 days ago·Newcastle upon Tyne, United Kingdom

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