The government generated a record £6.8 billion in inheritance tax receipts between April 2023 and February 2024, marking a £400 million year-on-year increase.
This puts what is dubbed ‘Britain’s most-hated tax’ on track to break tax-year records.
Despite affecting only 4% of the population, IHT is often maligned for its unfairness.
Under the IHT regime, tax is paid on the estate (the property, money, and possessions) of someone who has died, charged at 40% on all assets above a £325,000 threshold.
Married couples and civil partners can pass any unused threshold to one another, potentially doubling the threshold to £650,000, or up to £1 million with the residence nil rate band.
Though the levy was originally intended for the uber-rich, more and more taxpayers are being pushed into paying the tax due to fiscal drag.
The Institute of Fiscal Studies think tank estimates that up to 12% of the population could be pushed into paying IHT by 2033.
Due to its unpopularity, many speculated that Chancellor Jeremy Hunt would reduce, recalibrate or even scrap the tax in his Spring Budget.
Hunt ultimately dodged the issue altogether, leaving IHT as it is.