How Inheritance Tax Works: Thresholds, Rules and Allowances

How Inheritance Tax applies to an estate

Inheritance Tax is a tax on the estate of someone who has died. An estate includes their property, money and possessions. Funds from the estate are used to pay Inheritance Tax to HM Revenue and Customs.

When gifts can be taxed

People who receive gifts from you might have to pay Inheritance Tax, but only if you give away more than £325,000 and die within 7 years.