Today’s Autumn Budget, delivered by Chancellor Rachel Reeves, places renewed emphasis on balancing the books through a ‘stealth’ tax approach, freezing income tax thresholds, slashing the £20,000 cash ISA allowance to £12,000, extending the freeze on inheritance tax bands, and introducing new levies such as a mansion tax and EV mileage charge. 

While headline increases to income tax were avoided, the combination of threshold freezes and targeted levies signals a firm commitment to generating an additional £26 billion over the next Parliament. 

The Infected Blood Compensation Scheme and Agricultural and Business Property Relief

Aside from the  freezing of the IHT thresholds until 2031, two further key points have come out of today's budget concerning Inheritance Tax. 

Firstly, the Government has confirmed that compensation payments made under the Infected Blood Compensation Scheme will now be fully exempt from Inheritance Tax (IHT). This means that whether the payment stays with the original recipient or is passed on to family members, it will not attract IHT.

 This resolves the ‘secondary transfer’ flaw that unfairly punished bereaved families of the infected blood scandal. These changes provide welcome clarity and fairness for affected families after long campaigning by STEP and the Association of Lifetime Lawyers.

Secondly, a small concession to farmers and business owners following previous announced changes to Agricultural and Business Property Relief. The 100% relief allowance will now be transferable between spouses, bringing this in line with wider IHT rules. 

This budget changes will affect a growing number of families, particularly those with rising property values, savings, pensions, or farming and business assets, making proactive estate planning more essential than ever. Our team can help you review your options and ensure everything is structured in the most efficient way.