No. Estates worth less than the current threshold of £325,000.00 do not attract any inheritance tax liability. The executor still has to report the value even if it is below the tax threshold. If the deceased has an estate worth more than the threshold but leaves the remainder to their spouse, civil partner, a charity or a community amateur sports club, then no inheritance tax is payable. Beneficiaries do not normally have to pay inheritance tax on what they inherit. People who have benefited by way of gifts of cash or property from the deceased in the 7 years before death may have to pay inheritance tax too, if the value given away exceeds 325,000.00 in that time frame.

The standard rate of tax is 40% on the value of the estate above the threshold. There are a number of reliefs and exemptions available. The rules on dealing with property gifted to family are complicated and professional advice is essential to get the tax return right.