Overview

• Life insurance premiums rose 18% to £447 million in the year to March 2025 as families seek protection from future inheritance tax liabilities.
• From April 2026, agricultural and business relief will be capped at £1 million of qualifying assets, with amounts above receiving 50% relief, and some listed shares such as AIM moving from 100% to 50% relief.
• From April 2027, unspent defined contribution pensions will be included in estates at the 40% rate, a change expected to affect about 8% of estates, and the rule applies even if the deceased had not reached the pension access age.
• Treasury officials are reported to be considering tighter gifting rules or a lifetime cap before the November Budget, leading advisers to urge clients to review plans now.
• HMRC recorded 31,500 estates liable for inheritance tax in 2022/23 with total liabilities of £6.7 billion, while FOI data show 2,520 estates faced bills above £500,000 with projections of further increases this year.