HMRC opened 4,940 inheritance tax investigations last year. That’s the highest number in six years, up 18% on the year before, and most of the people caught up in it aren’t hiding money offshore. They’re ordinary families who inherited a house, sorted out a parent’s estate as best they could, and got a letter a few months later asking questions they didn’t expect.

Key Takeaways

4,940 IHT investigations opened in 2025/26, an 18% rise and a six-year high.
Over 14,000 investigations launched since 2022, with more than 1,800 still open.
HMRC clawed back £246 million from these investigations in 2024/25 alone.
The £325,000 tax-free threshold hasn’t moved since 2009.
The OBR reckons close to 1 in 10 deaths will trigger inheritance tax by 2029/30, roughly double the current rate.

Table of Contents

Why Now

Nothing about the tax itself has really changed. The threshold has stayed still while everything around it moved. £325,000 was set as the nil-rate band back in 2009, at a time when the average UK house cost roughly £150,000. Property has more than doubled in value since then, and the threshold hasn’t budged an inch in over fifteen years. Add the £175,000 residence nil-rate band on top, which applies when a home is passed to children or grandchildren, and a couple can combine both allowances to shelter up to £1 million tax-free. That sounds like plenty until you remember what an ordinary three-bed semi in the South East goes for now. Estates that would have had nothing to do with inheritance tax a decade ago are sliding over the line without anyone in the family realising it, and that’s exactly why HMRC’s caseload keeps growing.

Inheritance tax itself is charged at 40% on anything above the threshold, so even a modest overshoot can turn into a real bill. Sean McCann, a chartered financial planner at NFU Mutual, has pointed out that IHT is one of the most feared and least understood taxes in the country, and that more families will keep getting dragged into paying it as thresholds stay frozen and asset values keep climbing.

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What Actually Gets Flagged?

Forget the image of HMRC digging through offshore accounts and hidden trusts. A lot of these enquiries start somewhere far more mundane. Jewellery that never made it onto the estate valuation. A set of dining chairs nobody thought to price properly. A painting that turned out to be worth more than the family guessed, or a watch collection that got waved through as sentimental rather than valuable. Advisers at TWM Solicitors have said undeclared personal possessions like these have prompted countless investigations over the years, far more often than anything resembling deliberate tax evasion.

Why HMRC Inheritance Tax Probes Have Reached a Six-Year High — Source by canva

The bigger shift is on the technology side. HMRC now checks estate valuations against the Land Registry, cross-references the Trust Registration Service, and even compares declared property values against Google Maps, essentially checking whether a house looks like what’s been claimed on paper. AI and data-matching software is running in the background too, flagging inconsistencies a human caseworker might have missed five years ago. None of this is secret. HMRC has been fairly open about using these tools as part of a wider push to close the gap between what’s owed and what’s actually declared.

The Money Involved

£246 million. That’s what HMRC pulled in from these investigations alone in the 2024/25 tax year, on top of £8.25 billion in inheritance tax collected overall that same year. And the totals keep climbing regardless of investigations. Between April 2025 and January 2026, IHT receipts hit £7.1 billion, £130 million ahead of the same stretch the year before. The Office for Budget Responsibility’s estimate for the full 2025/26 year comes in around £9.1 billion, which would make it one of the biggest years on record for the tax.

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Who’s Getting Pulled In Next?

A couple of upcoming changes are going to make this worse before it gets better. Unspent pensions fall within the scope of inheritance tax from 2027, something that’s currently exempt and has let a lot of families pass on retirement savings tax-free. Farm and business relief is also being scaled back from April 2026, tightening rules that previously let agricultural and business assets pass down largely untouched. Put those two changes next to a threshold that’s been frozen since 2009, and the OBR’s projections start to make a lot more sense: 9.5% of deaths are expected to trigger an inheritance tax bill by 2029/30, roughly double the 5.1% rate recorded back in 2022/23.

Oddly, the average bill itself is actually forecast to fall over that same period, from around £233,200 today to about £186,800 within a few years. That’s not because HMRC is going easier on anyone. It’s because so many smaller, more ordinary estates are being swept into the net alongside the genuinely large ones, dragging the average down even as the total number of people paying goes up.

How Long This Drags On?

Six to twelve months, usually, for a straightforward case. Not always, though. Of the more than 14,000 investigations opened since 2022, over 1,800 are still active, and thirteen of them are closing in on their fourth year without resolution. HMRC’s official line is that most people already pay the correct amount of inheritance tax, and that investigations only get opened where there’s a specific reason to think the numbers don’t add up, whether that’s an honest mistake, something forgotten in the valuation, or something more deliberate.

What Families Can Actually Do About It?

None of this means every estate is heading for a drawn-out investigation. Getting the valuation right the first time, personal possessions included, is the single biggest thing that seems to keep families out of trouble, according to the solicitors who deal with these cases regularly. Executors are legally responsible for valuing an estate accurately and telling HMRC what’s owed, and any tax due has to be paid within six months of the date of death before interest starts building on the unpaid amount. For anyone managing a parent’s or relative’s estate right now, that’s worth treating as seriously as it sounds, because a rushed valuation is exactly the kind of thing that turns into a letter from HMRC eighteen months down the line.

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Frequently Asked Questions

How many inheritance tax investigations does HMRC open a year?

4,940 in 2025/26, up 18% on the previous year and the highest total in six years.

Why are more ordinary families getting investigated?

The £325,000 threshold has been frozen since 2009 while property values have kept rising, so more estates cross the line without anyone intending to avoid tax.

What usually triggers an investigation?

Undeclared possessions like jewellery or furniture, valuations that don’t match Land Registry or Google Maps data, and flags from HMRC’s AI and data-matching systems.

How much has HMRC recovered from these cases?

£246 million in 2024/25 alone, on top of £8.25 billion in total inheritance tax collected that year.

How long do these investigations take?

Usually six to twelve months, though over 1,800 opened since 2022 are still open, some nearing four years without resolution.

Will more people have to pay inheritance tax in future?

Yes. The OBR expects close to 1 in 10 deaths to trigger a bill by 2029/30, up from roughly 5% now, partly due to pensions coming into scope from 2027 and reduced farm and business relief from 2026.

Sources and References

Tags: Estate Valuation HMRC HMRC Investigation Inheritance tax Inheritance Tax Rules Property Inheritance Tax Investigation UK Tax

Camilla Ashcroft

Hi, I'm Camilla, a journalist and writer with a Journalism degree from the University of Leeds. I began my career as a freelance writer, covering a wide range of topics including current affairs, culture, and digital media. Today, I specialize in trending news, politics, real estate, and the arts, delivering timely, accurate, and engaging coverage of the stories shaping public conversation.My work focuses on breaking developments, political analysis, real estate markets and trends, cultural reporting, and the creative industries. I am passionate about producing well-researched content that helps readers understand complex issues, stay informed about important events, and explore the evolving worlds of politics, property, and culture.