Understanding Inheritance Tax (IHT) Deadlines in the UK

When dealing with the loss of a loved one, managing financial matters can feel overwhelming. But certain legal obligations—particularly around Inheritance Tax (IHT)—come with strict timeframes that are essential to meet. Missing these deadlines can lead to avoidable interest charges, penalties, or even lost tax allowances.

In this article, we break down the key IHT deadlines and what you need to know to stay compliant and protect your loved one's legacy.

Inheritance Tax must be paid by the end of the sixth month after the person’s death.

For example, if someone dies in January, the IHT deadline is 31 July.

If the tax isn’t paid by then, interest will start to accrue automatically, even if HMRC hasn’t issued a bill yet. This interest compounds over time and can significantly increase the amount owed by the estate.

There are two main forms involved depending on the complexity of the estate:

IHT400 (for taxable or complex estates): Should be submitted within 12 months of death.

IHT205 (for excepted estates): Typically submitted alongside the probate application, also within 12 months.

Although you have a year to file the paperwork, you must pay any tax owed before you can obtain the Grant of Probate, which means acting much sooner in practice.

Yes. HMRC allows payment of IHT in instalments over up to 10 years—but only for certain types of assets, such as:

• Land or property
• Shares in a business or private company
• Unquoted securities

However, interest is still charged on the outstanding balance, so many executors choose to pay sooner if possible.

If the deceased owned a home being passed to direct descendants, an additional allowance may apply.

You must claim this within 2 years of the date of death.

If the deceased was a surviving spouse or civil partner, any unused nil rate band or RNRB from the first partner can usually be transferred.

Again, this must be claimed within 2 years of the second death.

As IHT is due before probate can be granted, this creates a practical issue—how do you pay tax before you can access the deceased’s funds?

Options include:

• Using the deceased’s bank account via HMRC’s Direct Payment Scheme
• Executors or family covering it temporarily (with later reimbursement)
• Taking out a probate loan

Inheritance Tax rules are complex, and the deadlines are strict. Missing them can result in:

• Costly interest
• Loss of valuable allowances
• Delays in probate

By acting promptly and seeking expert support, families can protect more of their estate and avoid stress during an already emotional time.

At Only The Best Will Do Ltd, we guide clients through estate planning and post-death administration.