Inheritance tax receipts hit £8.5bn as property estates stay in HMRC net

Author: Editorial team @ UK landlord & buy-to-let news, policy, and finance

British suburban homes in bright spring daylight

Inheritance tax receipts reached a record £8.5 billion in the 2025-26 tax year, giving landlords another reminder that property wealth is staying firmly in HMRC’s sights even as parts of the housing market cool. The new figure, up from £8.3 billion a year earlier, reflects how frozen thresholds keep drawing more estates into charge.

Why inheritance tax is still a landlord issue

For landlords, inheritance tax is not just a private wealth story. Many long-term investors now hold substantial housing wealth but relatively modest liquid assets, which can leave families exposed when a property-heavy estate is passed on. Even where rents are steady and values are no longer surging, years of frozen allowances mean more estates are edging into tax.

The position is especially awkward for portfolio owners whose plans have not kept pace with rising values, company structures, or changing family arrangements. A landlord may feel less wealthy than headline asset values suggest, but HMRC looks at the estate that exists on paper, not the cashflow pressure a family faces when tax becomes due.

This follows Landlord Knowledge’s recent report on how older households now hold most of the nation’s housing wealth. The latest HMRC receipts data suggests that concentration of wealth in property is still feeding through into higher tax takes, even without another big national house price boom.

Frozen thresholds keep dragging more estates into charge

The nil-rate band has been frozen at £325,000 for years, and that long freeze is doing much of the work. For landlords in the South East and for those with multiple properties, the threshold can look detached from market reality. Even in areas where prices have flattened, accumulated equity over a long holding period can leave a family facing a tax bill that was not part of the original investment plan.

That is why this matters beyond the headline £8.5 billion figure. It is another sign that tax planning cannot be left until late life or treated as something only very wealthy investors need to think about. Landlord Knowledge has also covered HMRC’s growing use of inheritance tax investigations, and the pattern is clear: the tax take is rising and scrutiny is not easing.

Landlords should also note that the latest receipts do not yet capture the full long-term effect of newer tax changes affecting pensions and reliefs. In other words, the current record may not be the high-water mark. If property remains the core of a family’s balance sheet, inheritance tax planning is becoming less optional and more basic risk management.

The official receipts series is set out in HMRC’s monthly tax and NICs receipts statistics, which show how inheritance tax has become a steadily larger source of revenue.

What this means for landlords

If you hold most of your wealth in property: do not assume weaker house price growth means inheritance tax risk has gone away.
Watch for: valuations, ownership structures and estate plans that have not been reviewed for several years.
Bottom line: frozen thresholds are still pulling landlord estates into charge, and waiting rarely makes the problem smaller.

Editor’s view
Inheritance tax is no longer just a problem for a tiny slice of very wealthy families. For landlords with long-held portfolios, it is becoming a mainstream planning issue, and ignoring it is starting to look less like caution and more like drift.

Author: Editorial team @ UK landlord & buy-to-let news, policy, and finance
Published: 24 April 2026

Sources: HMRC, Evelyn Partners, TWM Solicitors

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You can read the full article https://www.lawyer-monthly.com/2023/06/should-you-appoint-your-children-as-attorneys-in-your-lpa/

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