Inheritance tax (IHT) receipts hit £7.1 billion in the first ten months of the 2025/26 tax year, up £100 million on the same period last year, according to HMRC figures released today.

The Office for Budget Responsibility has forecast full-year IHT receipts of £9.1 billion, and with two months of the tax year remaining, the government appears on course to meet that target.

HMRC is taking more from the UK population’s estates amid growing public criticism that inheritance tax is increasingly falling on middle-class families once considered well beyond the reach of death duties, as the government refuses to change thresholds that have been frozen since 2009.

MP salaries have increased 45%, and average civil servant pay is up around 50% – 60% during that period.

In addition to freezing IHT general thresholds since 2009, the current Labour government has attempted to change thresholds for farmers, and was met with public rebuke and forced to U-turn on proposals.

“The government has made a pig’s ear of inheritance tax reform,” said Isaac Stell, Investment Manager at Wealth Club.

“Crackdowns on farmers and business owners proved unpopular and ultimately unworkable, forcing a partial retreat on relief thresholds. But years of frozen allowances, combined with new rules that will bring pensions into the scope of IHT, mean more ordinary families, not just the wealthy, are being pulled into the tax net.”

Rising property prices are playing a big part in the increase in IHT receipts, with the steady tick higher in average house prices and frozen thresholds ultimately resulting in those that aren’t considered wealthy having HMRC get their hands on their estate.

“I suspect underneath the overall figure there will be an upturn of IHT taken from UK regions outside the South East. The South East has traditionally made up the lion’s share of IHT liabilities and that will continue to be the case for a long time, given several decades of wealth creation in the region,” said Ian Dyall, Head of Estate Planning at wealth management firm Evelyn Partners.

“But property values in and around London have levelled off in recent years, and even fallen in real terms in some areas compared to general inflation, while elsewhere in the country house prices had seen double-digit annual increases. That could mean many families in the South West, Midlands and North of England are being dragged into the potential IHT net by the increase in their home’s value, probably without realising it.”

The FTSE 100 fell victim to poor corporate updates on Thursday, driving a retreat from the record closing high notched up yesterday. 

Nothing goes up in a straight line and disappointing results from Centrica and Rio Tinto ensured London’s leading index didn’t get a head of its self after storming session on Wednesday.

The FTSE 100 was down 0.3% on Thursday but still comfortably above the 10,600 mark. 

“Investors got a nasty shock from Centrica’s results, causing the shares to slump and drag the UK market down in the process,” said Dan Coatsworth, head of markets at AJ Bell. 

“While Centrica is in the bottom half of the FTSE 100 by weighting, a large downward movement from its shares still had meaningful influence on the UK stock index.

“The UK market was also dragged down by the market reaction to Rio Tinto’s results, albeit that looked more like profit taking after a strong rally than anything worrying in its figures.”

Centrica was at the bottom of the leaderboard, losing 5%, after reporting 2025 results. Centrica’s results were a huge disappointment for investors who were licking their wounds after the group reported a halving of EBITDA and total destruction of free cash flow.

Aarin Chiekrie, equity analyst, Hargreaves Lansdown, said: “On the face of it, British Gas owner Centrica’s headline numbers were a tough read as energy markets adjusted to more normalised conditions. Lower commodity prices and lower energy price volatility weighed on performance, causing total profits to fall sharply.”

Rio Tinto was also among the losers after reporting strong earnings, but not strong enough to warrant further upside. Antofagasta set a high bar for mining financial performance earlier this week; unfortunately, Rio Tinto hasn’t been able to match it. 

“Rio Tinto’s full year numbers are solid operationally but short on earnings fireworks,” said Adam Vettese, market analyst for eToro.

“Copper-equivalent production climbed 8%, with copper output up 11% thanks to the Oyu Tolgoi ramp up, while EBITDA rose 9% on tighter costs and higher volumes. Management held the dividend steady at $6.5bn, the tenth year at the top of the 40-60% payout range, but there’s no buyback boost to excite shareholders like other sector peers. 

“On the downside, underlying earnings were flat, net profit down 14%, and free cash flow off 28% as capex and provisions bit. Iron ore still dominates earnings, so China risk lingers even as copper and aluminium grow.”

Rio Tinto shares were around 3% weaker at the time of writing. 

RELX continued its recovery on Thursday, gaining 4%, and was the FTSE 100’s best performer. Mondi shares were 2% higher after the group released earnings that showed some signs of stabilisation.

Centrica was one of the companies that benefited massively from surging fossil fuel prices as war erupted in Eastern Europe. Those days seem a long time ago now. 

Shares fell 9% on Thursday after the group reported a 50% decline in operating profit in 2025 and the eradication of free cash flow as lower fuel prices rocked the business’s trading unit.

“On the face of it, British Gas owner Centrica’s headline numbers were a tough read as energy markets adjusted to more normalised conditions,” said Aarin Chiekrie, equity analyst, Hargreaves Lansdown.

“Lower commodity prices and lower energy price volatility weighed on performance, causing total profits to fall sharply. This was particularly apparent in the group’s trading arm, Centrica Energy, which buys and stores gas when prices are low, then waits for higher prices to generate and sell power back to the market, profiting on the difference. But the division fell well short of prior guidance, and performance is likely to remain subdued through 2026.”

The British Gas owner posted adjusted EBITDA of £1.4bn for the year ended 31 December 2025, down sharply from £2.3bn in the prior year, while adjusted operating profit fell to £0.8bn from £1.6bn. Adjusted basic earnings per share came in at 11.2p, down from 19.0p in 2024.

Centrica increased its full-year dividend per share by 22% to 5.5p and completed a £2bn share buyback programme, returning a total of £1.1bn to shareholders during the year, including £0.8bn through buybacks.

However, the company has now paused further share buybacks to prioritise investment spending. This will be a kick in the teeth for investors, but the lack of free cash flow would have left the group with little choice.

Chris Beauchamp, Chief Market Analyst at IG, said: “Centrica’s need for cash has been underlined by its decision to suspend the buyback to focus on investments and infrastructure, but the shares had arguably run too far ahead in the short-term anyway.

“In a world where investors are focusing more and more on companies that will benefit from the infrastructure boom, Centrica’s uncertain outlook makes it less attractive, putting the share price gains of recent years under pressure.”