When do you pay inheritance tax?

You pay inheritance tax on any inheritance you receive. An inheritance consists of the estate (assets and liabilities) left by a deceased person. In some cases, you do not pay inheritance tax.

Amount of inheritance tax

Part of the inheritance is exempt from tax. The precise amount depends on your relationship to the deceased person.

The Tax and Customs Administration lists the exemptions on its website. You pay inheritance tax on the amount exceeding the exemption. Inheritance tax rates are also available on the Administration’s website.

You can use the Tax and Customs Administration’s inheritance tax calculator to work out how much tax you have to pay.

Inheriting a business

If you inherit a business, you pay inheritance tax on its value. If you continue to run the business, you will qualify for the business succession scheme and pay less or no inheritance tax.

Exemptions from inheritance tax

You do not pay inheritance tax on a surviving dependant’s pension or state pension. The surviving dependant’s pension, however, is deducted from the partner’s exemption. In certain special situations you pay less or no inheritance tax. Contact the Tax and Customs Administration for more information.

Filing an inheritance tax return

You file an inheritance tax return by completing and submitting an inheritance tax return form. The Tax and Customs Administration will automatically send you this form. If you think you have to pay inheritance tax but have not received a form, you can use the TaxLine to contact the Administration.

More information about inheritance tax

Inheritance tax is collected by the Tax and Customs Administration. More information on inheritance tax is available on its website. You can also use the TaxLine to ask any questions.

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