Estates and wealthy individuals may have underpaid inheritance tax (IHT) by as much as £392m in the last tax year, according to a new report.
The figure for suspected underpayment from HMRC is a rise of 14% year-on-year, according to the report from law firm TWM Solicitors.
According to the law firm, HMRC is increasingly focusing on data from property and financial services firms in order to identify gaps.
Value of IHT that HMRC suspects has been underpaid
Some of the issues the law firm expects HMRC to be looking into include:
· Valuable chattels such as jewellery, watches and paintings, that were insured by the deceased but are missing from the probate.
· Artworks that have had an artificially low value placed on them.
· Bank records showing transfers to overseas bank accounts or cryptocurrency accounts where there is no mention of these in probate.
Pr Previous research from the law firm found that HMRC was also paying increasing attention to property valuations, with referrals to the Valuation Office Agency rising 23.5% from 11,845 to 14,631 in the 12 months to September 2025.
Duncan Mitchell-Innes, deputy head of private client and partner at TWM, said: “HMRC's increasingly sophisticated data analytics are making it easier for them to spot underpayment.
"Executors should make sure they obtain robust professional valuations for significant assets and keep detailed records supporting the figures submitted to HMRC. Taking advice early can help avoid lengthy investigations, penalties and interest."