{"id":350,"date":"2019-06-12T15:41:19","date_gmt":"2019-06-12T14:41:19","guid":{"rendered":"https:\/\/taxfix.com\/en-uk\/?p=350"},"modified":"2024-04-02T16:49:13","modified_gmt":"2024-04-02T15:49:13","slug":"inheritance-tax-rates-allowances","status":"publish","type":"post","link":"https:\/\/taxfix.com\/en-uk\/the-tax-basics\/inheritance-tax-rates-allowances\/","title":{"rendered":"What are the Inheritance Tax rates and allowances?"},"content":{"rendered":"\n<p><a href=\"\/en-uk\/glossary\/inheritance-tax-iht\/\">Inheritance Tax (IHT)<\/a> is the tax paid on someone\u2019s <a href=\"\/en-uk\/glossary\/estate\/\">estate<\/a> after they pass away.<\/p>\n\n\n\n<p>In the 2024\/25 tax year, the standard IHT rate is 40%, payable for most estates that are larger than \u00a3325,000.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What is the IHT tax-free allowance?<\/h2>\n\n\n\n<p>Usually, there no Inheritance Tax to pay if either:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The value of your estate is below \u00a3325,000<\/li>\n\n\n\n<li>You leave everything above the \u00a3325,000 threshold to your spouse, civil partner, or a charity.<\/li>\n<\/ul>\n\n\n\n<p>This limit is called the <a href=\"\/en-uk\/glossary\/inheritance-tax-iht-allowance\/\">IHT Allowance<\/a>. Also, if you <strong>leave your home to a child or grandchild<\/strong>, you get another \u00a3175,000 as an extra &#8220;main residence&#8221; allowance.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What are the IHT tax rates?<\/h2>\n\n\n\n<p>The standard Inheritance Tax rate is <strong>40%. <\/strong><\/p>\n\n\n\n<p>If you leave at least 10% to a charity, this drops to 36%.<\/p>\n\n\n\n<p>In any case, this is charged only on the part of the estate that is above the IHT allowance.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Who will actually pay the IHT?<\/h2>\n\n\n\n<p>Your beneficiaries:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Heirs<\/strong> don\u2019t need to do this themselves: the executor will use money from your estate to pay the IHT directly to HMRC. <\/li>\n\n\n\n<li><strong>People you gave gifts to<\/strong>, however, might have to pay IHT themselves &#8211; but only if you give away more than \u00a3325,000 or pass away within seven years.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Do spouses have to pay IHT?<\/h2>\n\n\n\n<p>No:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Married couples and civil partners can give assets to each other completely tax-free.<\/li>\n\n\n\n<li>Also, the surviving partner can use both IHT allowances, often ending up with a <strong>double allowance<\/strong>. <\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">What about gifts?<\/h2>\n\n\n\n<p>It all depends:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Some gifts are always tax-free:<\/strong> gifts to spouses, civil partners, and charities.<\/li>\n\n\n\n<li>Any gifts made <strong>more than seven years before passing away<\/strong> are also tax-free.<\/li>\n\n\n\n<li><strong>Most small gifts<\/strong>: wedding gifts (maximum is \u00a35,000 for a child), any gift up to \u00a3250, etc.<\/li>\n\n\n\n<li><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Inheritance Tax (IHT) is the tax paid on someone\u2019s estate after they pass away. In the 2024\/25 tax year, the standard IHT rate is 40%, payable for most estates that are larger than \u00a3325,000. What is the IHT tax-free allowance? Usually, there no Inheritance Tax to pay if either: This limit is called the IHT [&hellip;]<\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[430,427],"tags":[416,423,418],"class_list":["post-350","post","type-post","status-publish","format-standard","hentry","category-gifts-winnings-and-inheritance","category-the-tax-basics","tag-benefits-reliefs-grants","tag-gifts-inheritance","tag-invest"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What are the Inheritance Tax rates and allowances? &#8211; Taxfix<\/title>\n<meta name=\"description\" content=\"Inheritance tax (IHT) is the tax paid on someone\u2019s estate, after they pass away. 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