It features on The Private Office’s 2026 inheritance tax map, with an average liability of £20,814 per estate, driven largely by rising property values pushing more estates above the tax threshold.
The data highlights a North-South divide, with inheritance tax exposure heavily concentrated in London and the South East, and only Trafford appearing from northern England.
Pippa Vick, financial adviser at The Private Office, said: “Inheritance tax is increasingly becoming a property tax by default.
“Many families don’t consider themselves wealthy, yet long-term house price growth means their estates can face substantial tax bills.
“Without proper planning, beneficiaries may be forced to sell assets simply to settle the liability.”
The analysis found that 136 local authorities are already exposed to inheritance tax in 2026, with average liabilities ranging from just over £150 to more than £340,000 per estate.
Kensington and Chelsea topped the list with an average bill of £343,924 per estate, alongside Camden, Richmond upon Thames, and Hammersmith and Fulham – all recording liabilities well into six figures.
Other high-liability areas include commuter belt locations such as Elmbridge, St Albans, and Windsor and Maidenhead.
The report warns that pending pension rule changes will push even more estates above the threshold.
From April 6, 2027, most unused pension funds and death benefits will be included in an individual’s estate for inheritance tax purposes—a shift from the current exemption.
Based on this change, The Private Office estimates that 152 additional local authorities could become liable, raising the total to 288 nationwide.
The inheritance tax nil-rate band is frozen at £325,000 until the 2030/31 tax year, but the residence nil-rate band allows the threshold to rise to £500,000 if a home is passed to direct descendants.
Despite the thresholds, rising house prices mean more estates are exceeding these limits.
UK inheritance tax receipts have already hit £8.25 billion for 2024/25 and are expected to surpass £9 billion by 2026/27.
Ms Vick said the pension change could bring new regions into scope for inheritance tax liabilities.
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She said: “Pensions have long sat outside inheritance tax calculations, so bringing them into scope has a major regional impact.
“In high-property-value areas, the effect is dramatic, but even in more affordable regions, families who previously expected no inheritance tax may now face a bill.
“Planning early will be crucial.”
