Thousands of British families could benefit from significant savings thanks to a little-known inheritance tax rule change introduced by HMRC.
What's Changing?
The updated rules now allow more flexibility in how inheritance tax allowances are transferred between spouses or civil partners. Previously, many families lost out on valuable tax breaks due to strict limitations.
Key Benefits:
- Increased transferable nil-rate band between partners
- More options for passing on family homes tax-free
- Greater protection for estates under £1 million
Who Stands to Gain?
Experts estimate these changes could particularly help:
- Middle-class families with valuable family homes
- Those who lost a spouse in recent years
- Couples with combined estates between £650,000-£1 million
Financial advisor Sarah Wilkins explains: "This is a game-changer for many ordinary families who previously faced unexpected tax bills. Proper planning could now save heirs tens of thousands."
Action Required
While the changes are automatic, families should:
- Review their wills and estate plans
- Check eligibility for transferred allowances
- Consult a tax specialist if unsure
The new rules apply to deaths occurring after 6 April 2023, with potential retrospective claims for some cases.
