Inheritance tax receipts have climbed to £5.8 billion in the first eight months of the 2025/26 tax year, underlining the growing importance of later life and property-based financial planning.

Data published by HM Revenue & Customs shows receipts are £84 million higher than the same period last year, continuing a steady rise that has been in place for more than two decades.

The Office for Budget Responsibility has forecast that inheritance tax will raise £9.1 billion across the full 2025/26 tax year, a figure that appears increasingly likely to be met with four months still to run.

The upward trend has been reinforced by decisions taken in last month’s Budget, including the confirmation that the inheritance tax nil rate band will remain frozen at £325,000 until April 2031.

With property values and asset prices continuing to rise, more estates are being drawn into the tax net through fiscal drag.

LATER LIFE LENDING IN FOCUS

For advisers working with older clients, the figures underline the growing relevance of housing wealth in later life planning.

Will Hale, chief executive of Key Advice & Air, said: “These latest figures, alongside the confirmation in last month’s Budget that the Inheritance Tax nil rate band will remain frozen at its current level of £325,000 until April 2031, mean that the record-breaking £9bn+ in IHT receipts expected in 2025/26 will continue to grow in the years ahead.

“Furthermore, with pensions being brought into the scope of IHT from April 2027, it is clear that efficient transfer of wealth through the generations is becoming ever-more complex.

“This should be viewed as a great opportunity for advisers to demonstrate the value they deliver but planning strategies need to be reviewed in light of the changes to the tax environment.

“With over £3.7 trillion in property equity in the hands of the over 55s, it is crucial that the home forms part of the plan and that advice considers how products such as modern lifetime mortgages can form part of efficient intergenerational wealth planning.”

The inclusion of unspent pension pots within the scope of inheritance tax from April 2027 is expected to further shift attention towards property wealth as a planning tool, particularly for clients seeking to support family members during their lifetime while managing future tax liabilities.

Commenting more broadly on the tax outlook, Isaac Stell, investment manager at Wealth Club, said the Budget confirmed inheritance tax as one of the government’s most dependable revenue sources, driven largely by frozen thresholds rather than headline rate rises.

He noted that the nil rate band and residence nil rate band will now remain unchanged until April 2031, alongside new limits on business and agricultural property reliefs.