A Freedom of Information (FoI) request by NFU Mutual found that 12,915 reclaims have been made on the sale of property in the three tax years between April 2022 and April 2025.
According to calculations by NFU, the number of reclaims on property increased by 65% between the tax year which ended in April 2023 and the tax year ended April 2025.
Inheritance tax is assessed on the value of a person’s estate on the date of death and the tax must normally be paid within six months.
If, when the executors come to sell any property or shares, the price has fallen, they can reclaim the overpaid tax from HMRC. The tax refund is not automatic and has to be pro-actively reclaimed.
A tax refund is available if the executors sell property within four years of the death, or if they sell shares or other qualifying investments within 12 months of the death.
‘Nasty shock for grieving families’
Sean McCann, chartered financial planner at NFU Mutual, said: “A large inheritance tax bill can be a nasty shock for grieving families. These figures show that more and more people are waking up to the possibility that they could reclaim overpaid inheritance tax.
“Considering the buoyant housing market, it’s surprising to see more than 12,915 reclaims have been made on the sale of property in the last three years.
“In some cases, this will have been a result of property having been overvalued on the inheritance tax return or because of deterioration of the property between the death and subsequent sale.
“Over the last three years there have been 5,096 reclaims where executors have sold shares or other qualifying investments following a fall in value. During times of market volatility it’s important families check whether they can reclaim inheritance tax, in some circumstances it can amount to thousands of pounds.”
If you are reclaiming overpaid IHT following a fall in the value of shares or investments, all qualifying investments sold by the executor in the 12 months following death must be included in the claim, not just those that have fallen in value.
“If some have increased in value, this will reduce the amount of inheritance tax that can be reclaimed. In these circumstances, it may be more advantageous for the executors to pass the shares or investments that have increased in value direct to the beneficiaries rather than sell them. This means you make a claim only for those shares that have fallen in value, ensuring you maximise the benefit,” said McCann.
