A recent Telegraph article highlighted constituencies where families are facing Inheritance Tax (IHT) bills of more than £1million. For many, that headline will feel shocking. For those of us working in personal tax, it isn’t.
What is changing is not the tax rate; it is the number of families being caught by it.
Why are £1m IHT bills becoming more common?
IHT thresholds have been frozen for years.
At the same time:
- Property values have risen significantly,
- Investment portfolios have grown,
- Business owners have built valuable companies,
- Pensions have accumulated over decades.
The Nil Rate Band remains at £325,000.
The Residence Nil Rate Band adds complexity.
And once Estates exceed £2 million, this starts to taper.
This combination means many families who would never have considered themselves “wealthy” are now exposed to IHT. Not because they have done anything wrong, but because the landscape has shifted around them.
The quiet tax rise nobody talks about
When thresholds are frozen and asset values rise, more Estates drift into the IHT net. It is not dramatic shift though, it’s gradual. But over time, it’s significant.
Particularly in areas such as Berkshire, Surrey, and Cambridge, where property inflation alone can push an Estate well beyond £1 million. For business owners, there is an added layer of risk. Reliefs such as Business Relief can be extremely valuable, but they are technical, conditional, and subject to change. It can be costly to make assumptions too!
The most common misconceptions we see
- “I won’t have an IHT problem.”
Many clients only review their exposure when it is too late to plan effectively. - “My business solves everything.”
Business Relief can reduce IHT, but qualification is not automatic and structures matter. - “I’ll deal with it later.”
IHT planning is rarely effective when done in a rush. The most efficient strategies often require time. - “It’s just about tax.”
It isn’t. It is about control, clarity, protecting family wealth, and avoiding unnecessary stress at an already difficult time.
Good planning is not about avoiding tax at all costs
At Wilson Partners, our approach to IHT is pragmatic and structured; we’re not interested in aggressive schemes or unnecessary complexity.
We focus on:
- Understanding the full asset picture,
- Stress-testing assumptions,
- Modelling future scenarios,
- Ensuring reliefs genuinely apply,
- Aligning tax planning with wider family objectives.
The goal is simple: to help families make informed decisions and sleep better at night.
The earlier the conversation starts, the more options you tend to have. IHT is not a conversation about death, it is a conversation about legacy. About ensuring that what you have built, whether that is a property portfolio, an investment strategy, or a successful business, passes to the right people, in the right way, at the right time.
£1million IHT bills may make headlines, but with careful, early planning, they do not have to become a surprise.
Most IHT problems are not caused by a lack of wealth, they are caused by a lack of planning. If you would like an objective view of your current exposure, particularly if your Estate includes property or a trading business, we would be happy to review your position and model the potential outcomes.
Get in touch to understand your position, and if there’s any planning to be had to mitigate your IHT exposure.
