Chancellor raises inheritance tax threshold to £1m

clock •

George Osborne has confirmed the inheritance tax (IHT) threshold will increase to £1m for couples funded by a pension tax relief cut for people earning more than £150,000.

Osborne said the threshold at which the IHT is levied will rise for couples from £650,000 after April 2017. Currently, IHT applies at 40% on estates above a tax-free allowance of £325,000 per person. The Conservatives pledged in their election manifesto that, from April 2017, parents would each be offered a further - and transferable - £175,000 "family home allowance". "Promise made, promise delivered," said Osborne. He added passing on wealth to your children was "about the most basic aspiration there is". Under the new rules, a couple with a house worth £1m will be able to pas...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

Planning points: Paying pension funds to charity on death

Planning points: Paying pension funds to charity on death

IHT on pensions may create opportunities for charitable giving

Martin Jones
clock 16 October 2026 • 3 min read
Torsten Bell: Pensions industry must 'give ground' to what savers trust

Torsten Bell: Pensions industry must 'give ground' to what savers trust

Torsten Bell says what the industry is doing is a ‘triumph’, but there must be transparency

Holly Roach
clock 15 October 2026 • 1 min read
Shadow pensions minister warns over using tax relief as 'backdoor' route to mandation

Shadow pensions minister warns over using tax relief as 'backdoor' route to mandation

Helen Whately sets out a pro-business stall and casts doubt on increased AE contributions

Alex Levy
clock 15 October 2026 • 2 min read