Inheritance Tax (IHT) is a tax payable on the value of a person’s estate when they die. It is paid if the value of their possessions (their estate) exceeds their IHT thresholds (also known as nil rate bands) and exemptions. If your estate is large enough to incur Inheritance Tax, you can reduce or even avoid it in a number of ways with the help of a financial adviser.
If you are married or have a civil partner, then you can leave your entire estate to your spouse or partner free of inheritance tax. But if you want to leave some or all of your estate to family and friends, then it may be liable for inheritance tax.