Interest on inheritance tax is the part of the bill nobody plans for, because it starts running at a point when the executors usually cannot pay. The tax is due by the end of the sixth month after the death, and probate, which is what releases the money to pay it, often takes longer than that. An interest calculation is therefore a normal part of administering a large estate rather than a sign that something has gone wrong.
The date the clock starts
GOV.UK is specific: inheritance tax must be paid by the end of the sixth month after the person died, so a death in January means payment by 31 July. HMRC charges interest if the tax is not paid by that due date. The date is fixed by the death rather than by the grant of probate, by the date the account is filed, or by when the estate's assets can actually be sold.
The rate, and where to read it
HMRC publishes the inheritance tax interest rate as a table of periods rather than as a single number, because it moves with market rates. The rate is 7.75% from 9 January 2026, having been 8.00% from 27 August 2025. The same table shows interest on repayments, currently 2.75%, which is what HMRC pays back where too much tax was paid in advance.
Why an executor pays interest on money they do not have
The estate's cash is usually inside accounts the bank will not release without a grant, and the property cannot be sold before it. GOV.UK notes that a payment towards the tax is normally needed before a grant of representation can be obtained at all, which is called confirmation in Scotland. That circularity is the reason inheritance tax lending exists and the reason paying early, where cash is available, is worth doing.
What reduces it
Paying something on account reduces the balance interest runs on, and GOV.UK's own page advises paying early to avoid interest. Tax on some assets, notably land and certain shares and businesses, can be paid in yearly instalments, which changes the profile rather than removing the interest. An overpayment is not wasted: HMRC refunds the excess with interest at the published repayment rate.
Questions people ask about IHT interest calculator
When does interest start running?
From the end of the sixth month after the death, which is the due date for the tax itself. HMRC charges interest if the tax is not paid by then, and the date does not move because probate has not been granted or the account has not yet been filed.
What rate does HMRC charge?
HMRC publishes it as a table of periods because it moves with market rates. It is 7.75% from 9 January 2026. The same published table gives the rate on repayments, 2.75%, which HMRC pays where an estate has paid too much in advance.
Can inheritance tax be paid in instalments?
Yes, on some assets. GOV.UK sets out payment in yearly instalments as one of the ways of paying, which is aimed at estates holding land or a business that cannot be turned into cash quickly. Interest still runs on the outstanding balance, so instalments change the timing rather than the cost.
Does this page calculate the interest on my estate?
No. It says when the clock starts and what the published rate is, with the source for both, so you can see the shape of the figure. HMRC provides its own interest calculator, and an enquiry from here goes to the firm that files the account and settles the position.
Is there an HMRC IHT interest calculator?
Yes. HMRC's own service on GOV.UK, Calculate Inheritance Tax interest, works out the interest due on an Inheritance Tax payment, and HMRC publishes the interest periods and rates it works from beside its thresholds. The rate is 7.75% from 9 January 2026. This page does not run a calculation: it sets out when the interest starts and the published rate, with the source for both.