Inheritance tax (IHT) receipts dropped from £658m to £598m year-on-year in August, but the latest figures still signal towards the sixth consecutive year of record collections, HMRC has revealed.

The latest data follows a total of £868m in IHT receipts in July.

In the current financial year-to-date, £3.8bn has been collected in receipts, compared with £3.7bn at the same period last year.

Receipts are expected to continue rising, with tighter IHT policies announced in 2024’s Autumn Budget expected to push collections to £14.5bn in the 2030/31 financial year.

This would mark a 67% increase in collections over a five-year period, according to data from the Office for Budget Responsibility (OBR).

Head of UK technical services at Utmost, Simon Martin, said that while receipts are down month-on-month, IHT revenues remain "well above historical levels".

He added: "The reach of IHT is continuing to expand, with thresholds now frozen until 2031, Business Property Relief reforms having taken effect earlier this year, and unused pension pots due to fall within the scope of IHT from April 2027.

"While these changes may boost Treasury revenues in the near term, they also raise broader questions about the UK's competitiveness for entrepreneurs and wealth creators who have more flexibility than ever over where they choose to invest and build businesses."

Rachel Griffin, tax and financial planning expert at Quilter, has warned that potential changes to IHT rules may be coming before the end of the year.

She concluded: "IHT continues its upward trajectory as frozen thresholds, rising property values and increasing levels of household wealth bring more families into scope. What was once viewed as a tax affecting only the wealthiest households is increasingly becoming a mainstream financial planning issue.

"Given the scale of the IHT changes already due to come into force, as the inclusion of unused pension wealth comes within the scope of IHT from April 2027, it would be somewhat surprising to see this area targeted again at the Budget. The Government already has a significant increase in future receipts effectively built into the system. However, Budget speculation is just that, and it is never wise to completely rule anything out."

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