Inheritance Tax
Inheritance Tax is charged on the estate, usually at 40% above the available nil-rate bands. The residence nil-rate band applies to a home left to direct descendants, not normally to a buy-to-let. The executors usually pay before the estate is shared out.
Capital Gains Tax if you sell
Your gain is measured from the value at the date of death (the probate value), not what the original owner paid. Selling soon after inheriting often means a small gain. Report and pay within 60 days if tax is due; try the CGT calculator.
Income tax on the rent
While the estate is being administered, the executors handle the rent. Once the property is yours, add the rental profit to your own income and register for Self Assessment if needed. Read telling HMRC about rental income.
Keep or sell?
Check the property meets current safety rules and the EPC C 2030 target, review the mortgage (if any), and compare the rental profit after tax with selling. Joint inheritors should agree a plan early.
Sources
- GOV.UK: Inheritance Tax
- GOV.UK: Capital Gains Tax rates and allowances
- GOV.UK: Report and pay Capital Gains Tax on UK property
- GOV.UK: Renting out your property, paying tax
Sources last checked 10 November 2026. See all our sources and how we keep pages up to date.