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The Treasury has cashed in a record
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amount of money from inheritance tax and
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it could yet rake in more. Official data
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show that annual inheritance tax
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receipts rose to 8.5 billion pounds in
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the financial year between 2025 and
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2026. That's compared to total receipts
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of 8.3 billion pounds in the previous
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year. Under Chancellor Rachel Reeves,
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rules around inheritance taxes have been
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tightened including for rich foreign
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nationals who were not domiciled in
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Britain. But there has also been a
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continued freeze on a threshold of the
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nil rate band of 325,000 pounds on the
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value of people's estates. And as
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people's property valuations grow, more
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middle class families could be forced to
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pay the tax when loved ones die. Those
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last figures do not include any uplift
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from the government's inheritance tax
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rate on family businesses, pension
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savings and farms which all come into
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force later this month. This all means
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that the government is projected to take
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in yet more money from inheritance
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taxes. Alongside that jump, revenue from
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taxes on people's capital income also
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on the year. This has all been part of
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the Chancellor's push to fund a huge
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increase in government spending across
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public services without hiking people's
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The Treasury splashed out 72 billion
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pounds more over the last financial year
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helping to pay for higher wages across
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the NHS and education. That rise in
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inheritance tax is actually fairly small
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in proportion to the massive amount of
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money spent by the government each year.
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But the government had also argued that
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it helps to address inequalities and
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close loopholes. So, do you think
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targeting inheritance is a fair and
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effective way of funding spending
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increases? Let us know in the comments.
