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Inheritance Tax: What You Should Know Ahead of the Autumn Budget

  • Writer: Callum Dunbar
    Callum Dunbar
  • 5 days ago
  • 2 min read

With the next UK Autumn Budget on the horizon, one tax in the spotlight is inheritance tax (IHT). According to recent data, IHT receipts soared to £4.4 billion in just the first half of this tax year, with ministers and advisers already bracing for more change.


At Cleveden Park Wealth, we believe that preparing ahead of potential tax changes isn't about fear - it’s about choice, clarity and legacy. Here’s everything you need to know right now.


How IHT Works Today


  • Estates exceeding £325,000 are generally liable for IHT - a threshold that has remained unchanged since 2009, despite inflation.

  • If you leave your main residence to a direct descendant (child/grandchild), the residence nil-rate band adds up to £175,000.

  • Spouses and civil partners enjoy full IHT relief on transfers between them and unused allowances can pass to the surviving partner, meaning a married couple can potentially pass on up to £1 million tax-free under current rules.


However, with property values rising and thresholds frozen, more estates are being dragged into the IHT net than ever before.


Why This Matters Now


The conversation around IHT isn’t just academic:


  • Rumours suggest the government may revisit gifting rules, adjust nil-rate bands or bring larger pension pots into the IHT estate.

  • If you have built up pensions, property or investments, you could find yourself impacted even if you don’t consider yourself “wealthy”.

  • Planning ahead gives you more control: once thresholds are changed it’s too late to retroactively apply the old rules.


Practical Ways to Reduce Your IHT Bill


These aren’t radical moves - they’re sensible steps you can consider now.


  1. Make use of gifting allowances. You can gift up to £3,000 per year free from IHT; married couples can combine this allowance. Larger gifts may become exempt if you survive for seven years after making them.

  2. Consider tax-efficient investment or business reliefs. If you own a qualifying business or business property, you may be eligible for up to 100% relief from IHT. These are complex and require planning but can form part of your estate strategy.

  3. Review how pensions fit into your estate. From April 2027, many unused pension pots will become part of the estate for IHT purposes - something that could change how you think about retirement assets.

  4. Get professional advice. Because IHT is layered with rules, exemptions and timing considerations, structured advice can help you avoid costly mistakes.


No one can predict with certainty what the Chancellor will unveil in the Autumn Budget. But by taking proactive steps now, you position yourself with control rather than reaction.


At Cleveden Park Wealth, we specialise in helping clients craft strategies that preserve their wealth, protect their legacy and reflect their values.


Want to discuss how IHT could affect your plans and what you can do now? Get in touch with our team and we’ll help map out a tailored strategy for you.



 
 
 

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