Thinking about passing wealth to your family? The Autumn Budget is coming later than usual, and that delay could be bad news for your gifting plans.

Chancellor Rachel Reeves faces a huge challenge balancing the nation’s books, and inheritance tax (IHT) is one of the most talked-about areas ahead of this year’s Budget on 26th November. Rumours include a £50,000–£200,000 lifetime cap on tax-free giving, a longer qualifying period, or even scrapping the familiar “seven-year rule” altogether.

To put that into perspective, ignoring reliefs, exemptions, and allowances:

• If a £100,000 lifetime cap were introduced and you gave away £300,000, your heirs could face an £80,000 IHT bill.
• Under a stricter £50,000 cap, the bill could rise to £100,000.

With IHT receipts already at record highs, £8.2bn collected in 2024-25 (up £750m on the previous year), and announced changes already on the way (pensions included in estates from 2027, reduced business and agricultural reliefs from 2026), many families are asking: should they act now before the rules change?

Why the Budget Delay Could Be Bad News

This year’s Autumn Budget has been pushed back to 26th November – by about a month. That may give the Treasury more time to craft tougher measures, but it also means you will have less time to act once the details are announced. If new caps or rules take effect from Budget Day, any gifts made after that date could face higher tax exposure.

Governments Rarely Act Retrospectively – Another Reason to Act Early

One of the strongest arguments for early action is that UK governments generally do not make new IHT rules apply retrospectively.

• Example: Gordon Brown’s Trust Reforms (2006): His Budget changed how accumulation & maintenance trusts and interest-in-possession trusts were taxed, but only for trusts created after Budget Day. Existing trusts were largely preserved under the old regime, giving families certainty.
• Example: Rachel Reeves’ APR/BPR Changes (2024): Her Budget introduced a £1m per-person limit on business and agricultural property relief, but only for gifts or transfers made after 30 October 2024. Existing arrangements were not clawed back.

This history suggests that if a lifetime gift cap or seven-year rule reform is announced, gifts made before the change takes effect may be treated under the current rules. However, this is only speculation at this stage – nothing has been confirmed, and there is no guarantee that the government will follow the same approach this time. Acting early could help lock in today’s rules, but it is important to take professional advice before making any significant transfers.

Should I Act Urgently Before the Budget?

This is the question we are being asked most often at our seminars and in client meetings – and it is completely understandable.

Our advice is simple: plan, do not panic.

• There is a case for early action: If you were already planning significant gifts, making them before the Budget could help secure today’s more generous rules.
• But be strategic, not hasty: The proposed changes are still speculation. Acting too quickly can trigger other taxes, such as capital gains tax, or leave you short of funds you may need in the future.

The best approach is to review your position now, get advice, and be ready to act quickly if the Budget confirms a cap or other major reforms.

What Might Change (Still Speculation)

Here is what is being widely discussed:

• A lifetime cap on tax-free gifts, possibly £50k, £100k or £200k.
• Extension or removal of the seven-year rule, which could mean more gifts count towards the estate.
• Reform of taper relief, which could simplify or abolish the sliding scale that currently applies between years three and seven.
• Wider tax changes, including possible cuts to ISA allowances, reforms to property taxes, and higher capital gains tax rates for higher earners.

Key HMRC Stats

• £8.2bn: IHT collected in 2024-25, up £750m year-on-year.
• 31,500 estates: Paid IHT in 2022-23, a 13% rise on the previous year.
• £7.6bn: Collected between April 2024 and February 2025 alone, showing a sharp upward trend.

With nil-rate bands frozen until 2030 and property values still rising, more estates are being dragged into the IHT net every year.

What You Can Do Now

Here is how to prepare ahead of the Budget:

• Use annual allowances early: £3,000 annual gifting allowance, small gift exemption (£250 per recipient), and regular gifts out of surplus income remain available.
• Review larger gifts: If you were planning to transfer property, shares, or significant sums, consider doing so before the Budget.
• Review wills, trusts & LPAs: Make sure they are up to date and structured for flexibility.
• Keep clear records: Document gifts with dates and amounts to help executors claim reliefs.
• Check for CGT exposure: Gifts of property or shares can create an immediate CGT bill.
• Consider trusts: They may provide more control and stability if gifting rules tighten.

The Bottom Line

The Autumn Budget could be one of the most significant moments for inheritance tax reform in years. While it is still speculation, the combination of record IHT receipts, frozen thresholds, and a government needing to raise revenue means changes are highly likely.

Acting now, before any cut-off date, could secure today’s more favourable treatment for gifts, but you should plan carefully to avoid unintended tax consequences.

Contact Clarke & Wright today to review your options, explore tax-efficient ways to pass on wealth, and get ahead of any changes before the Autumn Budget arrives.

Disclaimer: This document is for information only and does not constitute tax advice.