UK inheritance tax receipts on track for a record £14.3bn – April’s changes may bite harder
UK families are facing the largest inheritance tax (IHT) bill in the tax’s history, with the Office for Budget Responsibility forecasting receipts will reach £14.3bn by 2029/30. The nil-rate band has been frozen at £325,000 since 2009 and will stay frozen until 2030, while property, pensions and savings have continued to rise in value – pulling a growing number of ordinary estates into a 40% tax charge that was, for decades, considered a concern only for the very wealthy.
The pressure is set to intensify further. From April 2027, unused pension funds will be brought within the scope of IHT for the first time, aggregated with the rest of the deceased’s estate and taxed at 40% above the available thresholds. And following changes introduced in April 2026, Business Relief – one of the most widely used planning tools for family businesses, farms and unquoted trading companies – is now capped at £2.5m per person, with relief on qualifying assets above that threshold cut from 100% to 50%.
“Too many people chase the tax break before securing their own future. We suggest working the other way round: establish what you need to live well for life, including care and the unexpected, then plan with what’s left. Get that order right and the planning follows naturally, with clients acting with genuine clarity about the capacity they have.” – Aled Phillips, chartered financial planner at Niche
Why UK startups may benefit from the changes
One of the fastest-acting reliefs covered in the guide is Business Relief via the Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS). Where lifetime gifts generally require the donor to survive seven years to fall outside the estate, qualifying EIS and SEIS shares can achieve full Business Relief after just two years of ownership, provided the shares are still held at death — all while the investor retains ownership of the capital rather than gifting it away outright. For investors interested in startup investing with higher risk appetites, there is a natural fit.
And this is where the UK’s startup ecosystem may benefit most. The SEIS and EIS schemes together pull in around £1.9bn annually from private investors who benefit from the reliefs. Given the pending changes to inheritance tax, and changes that reduced the IHT relief on AIM portfolios and reduced VCT income tax relief from 30% to 20%, the coming years could prove to be new records for SEIS and EIS investments.
“EIS has gone from a niche allowance to a mainstream estate-planning tool almost overnight. As AIM relief halves and pensions are pulled into the IHT net, EIS still delivers 100% Business Relief after just two years rather than seven. The discipline is to treat it as an investment first and a tax break second — which, for us, means diversifying widely enough to spread the risk.” — Graham Schwikkard, CEO at SyndicateRoom
The bottom line
The guide’s message throughout is that there is no single “magic bullet.” The most resilient estate plans layer several strategies — gifting, trusts, Business Relief, EIS and SEIS investing, Family Investment Companies, insurance and charitable giving — and are reviewed regularly as legislation, asset values and family circumstances change. With the nil-rate band frozen until 2030, Business Relief rules tightened from April 2026, and pensions joining the IHT net from April 2027, SyndicateRoom and Niche Private Clients say the case for starting that review now, rather than later, has rarely been stronger.