Inheritance‑tax receipts reached £1.5 billion in April and Might, the primary two months of the 2025‑26 tax yr, HM Income & Customs revealed on Thursday.
The determine is £98 million larger than in the identical interval final yr and retains the levy on its lengthy‑working upward trajectory.
But the most recent surge comes simply as ministers weigh a rethink of one in every of their most controversial reforms: extending inheritance tax to the worldwide estates of non‑domiciled residents. The measure, introduced earlier this yr and anticipated to lift about £430 million yearly, is now beneath evaluation amid experiences of an exodus of rich non‑doms.
“If rumours are correct, the Chancellor is contemplating a U‑turn,” mentioned Nicholas Hyett, funding supervisor at Wealth Membership. “Not only would that reduce the extra revenue HMRC was banking on, it also highlights the broader economic cost of driving affluent international residents away—lost spending, investment and philanthropy.”
Hyett argued that imposing the UK’s 40 per cent inheritance‑tax cost on international property was all the time the simplest change for the tremendous‑wealthy to sidestep: “City high‑flyers need to be in London; the mega‑wealthy can live anywhere. The UK is attractive, but not attractive enough to surrender 40 per cent of the family fortune.”
Advisers to non‑doms report that as many as 30 per cent of shoppers are actively relocating or contemplating relocation to extra beneficial tax regimes. Even when the Treasury rows again, Hyett warned, “the horse has bolted—plans are made and confidence in Britain’s stability has been dented.”
The controversy has been infected by contemporary hypothesis that ministers would possibly scrap inheritance‑tax aid on shares listed on London’s junior AIM market, simply months after aid was reduce in half. “That would be terrible news for AIM,” Hyett mentioned. “The constant tinkering creates exactly the kind of uncertainty that deters long‑term investment in smaller UK companies.”
With receipts climbing however excessive‑web‑price taxpayers heading for the exit, the federal government faces a dilemma: press forward with reforms in pursuit of additional income, or recalibrate to maintain globally cell wealth—and the broader financial advantages it brings—on British soil.
