Do I have to pay stamp duty on an inherited property?

Inheritance

16th December 2025

9 mins

We Buy Any House

Many people worry about stamp duty when dealing with an inherited property. This guide explains why stamp duty does not apply when you inherit a house, what other taxes you may face, and how to manage or sell an inherited property with confidence.

One of the first questions people ask after inheriting a home is whether they will face an immediate tax bill. Many beneficiaries worry about stamp duty and whether it applies to an inherited property.

The short answer is reassuring:

You do not pay stamp duty when you inherit a property.

However, while stamp duty is not payable at the point of inheritance, there are other taxes and financial responsibilities that may apply later, depending on what you decide to do with the inherited property.

These include inheritance tax, income tax, and capital gains tax, each triggered by different circumstances.

This guide explains everything you need to know about stamp duty on inherited property, clarifies when other taxes may apply, and helps you decide whether keeping or selling an inherited property is the right choice for you.

If you already know you want to sell, you can get a free cash offer for your inherited property from We Buy Any House today.

Stamp Duty and Inherited Property: The Simple Answer

When ownership of a property passes to you due to someone’s death, Stamp Duty Land Tax (SDLT) does not apply.

This means:

You do not pay stamp duty when you inherit a property
No SDLT return is required simply because ownership changes via probate
The transfer is not treated as a purchase

Stamp Duty only applies when property is bought for consideration, money or something of value.

An inherited property is transferred through an estate rather than purchased on the open market.

When Could Stamp Duty Apply After Inheriting a Property?

Although stamp duty does not apply when you inherit a property, it may become relevant later in specific situations.

You may pay stamp duty if:

You buy out another beneficiary’s share of inherited property
You purchase a property from the estate rather than inherit it
You use inheritance funds to buy another property

In these cases, stamp duty may apply to the transaction itself, not the inherited property transfer.

Understanding the Other Taxes That Apply to Inherited Property

While stamp duty is not payable, an inherited property can still trigger other forms of tax depending on what you do next.

These include:

Inheritance tax
Income tax
Capital gains tax

Understanding how and when each tax applies is essential for making informed decisions about your inherited property.

Inheritance Tax and Inherited Property

Inheritance Tax (IHT) is a tax on the estate of the deceased, not a tax on the act of inheriting itself.

When is Inheritance Tax Payable?

There is usually no inheritance tax to pay on an inherited property if:

The estate value is below £325,000
The property is left to a spouse or civil partner
The property is left to children, grandchildren and qualifies for the residence nil-rate band
The inherited property is left to an exempt beneficiary, such as a charity

If the estate exceeds the applicable threshold, an inheritance tax is charged at 40% on the value above the allowance.

Example: Inheritance Tax on an Inherited Property

If an inherited property is valued at £425,000 and the applicable threshold is £325,000:

£100,000 is taxable
Inheritance tax due = £40,000

This tax is typically paid by the estate, not the beneficiary.

Who Pays Inheritance Tax on an Inherited Property?

In most cases:

The executor of the will pays inheritance tax

Or the estate administrator if there is no will

The tax is usually paid using:

Estate funds
Proceeds from selling the inherited property
Money specifically left to cover tax

If the estate cannot pay, HMRC may require the beneficiary to settle the bill, and they will contact you directly if this applies.

Deadlines for Paying Inheritance Tax

Inheritance tax must usually be paid:

Within 6 months of the date of death

If payment is late:

Interest may be charged
Penalties may apply

You may be able to pay inheritance tax in instalments for inherited property, but interest is often added.

If you plan to sell the inherited property, the inheritance tax must usually be settled before completion.

What is the Inherited Property that was Gifted Before Death?

If the property was gifted to you during the deceased’s lifetime, different rules apply.

The 7 Year Rule and Inherited Property before death, it may still be subject to inheritance tax.:

0-3 years: up to 40% tax
3-7 years: tapered relief may apply
7+ years: no inheritance tax

This rule applies even if the property was transferred into your name before death.

Income Tax and Inherited Property

You do not pay income tax simply for inheriting a property. However, income tax may apply if the inherited property produces income.

Income Tax Applies if you:

Rent out the inherited property
Receive income from investments linked to the property.

You are taxed on:

Rental income minus allowable expenses
According to your personal income tax band

Being a landlord entails legal responsibilities and ongoing costs that should be carefully considered before deciding to rent an inherited property.

Capital Gains Tax and Inherited Property

Capital Gains Tax (CGT) is often the most misunderstood tax associated with inherited property.

When does CGT apply?

You only pay CGT if:

You sell the inherited property
And it has increased in value since the date of death

CGT is calculated using the probate value, not the original purchase price.

Capital Gains Tax Allowance

Each individual has an annual CGT allowance. Gains below this threshold are tax-free. Gains above it are taxed at residential property rates, depending on your income band.

This makes timing and planning the sale of an inherited property extremely important.

Can you Reduce Capital Gains Tax on an Inherited Property?

In some cases, yes.

Potential ways to reduce GCT include:

Using your annual allowance
Splitting gains on jointly inherited property
Living in the inherited property as your primary residence
Deducting allowable selling costs

However, there are limited options for altogether avoiding CGT once a gain has been made.

When Selling an Inherited Property Makes Sense

For many people, keeping an inherited property is not practical.

Common reasons include:

Ongoing maintenance costs
Council tax on empty inherited property
Disagreements between beneficiaries
The emotional burden of ownership

In these situations, selling the inherited property can provide clarity, closure and financial certainty.

Selling an Inherited Property Without Stress

Selling an inherited property can be emotionally and administratively challenging, particularly when it comes at a time of bereavement. While many people initially consider selling through an estate agent, traditional property sales often involve long timelines, repeated viewings, price negotiations and the constant risk of a buyer withdrawing at the last minute.

When dealing with an inherited property, this uncertainty can create unnecessary pressure, delay important tax decisions, and prolong a process that many want to resolve with clarity and dignity.

A fast, well-managed sale can offer a practical alternative, allowing beneficiaries to move forward without months of disruption or financial uncertainty.

Why Traditional Sales Can Add Stress to an Inherited Property

Selling an inherited property through the open market often involves:

Lengthy marketing periods with no guaranteed outcome
Chains that can collapse without warning
Delays caused by surveys, renegotiations or mortgage issues
Ongoing costs while the inherited property remains unsold

These delays can be particularly problematic when tax obligations, probate deadlines, or shared ownership arrangements are involved.

How a Fast Sale Can Help When Selling an Inherited Property

Choosing a quicker, more certain route to sell an inherited property can significantly reduce both financial and emotional strain.

A fast sale can:

Simplify inheritance tax settlement by releasing funds quickly, helping executors or beneficiaries pay HMRC without delay or interest charges.
Reduce capital gains tax exposure by limiting the period during which the inherited property can increase in value before sale.
Avoid prolonged empty property costs, such as council tax, insurance, security and maintenance expenses.
Help meet HMRC reporting deadlines, including the 60-day capital gains tax reporting requirement for residential inherited property.

By removing uncertainty and shortening timelines, a fast sale provides a clear endpoint to the process of inheriting property.

A Practical Solution for Inherited Property Sales

If your inherited property is empty, in need of repairs, or jointly owned, selling quickly can often be the most sensible and least fun option. Rather than navigating months of uncertainty, many beneficiaries choose a straightforward route that prioritises speed, transparency and peace of mind.

We Buy Any House specialises in purchasing inherited property quickly and professionally, offering a clear alternative to the open market.

With:

No estate agent fees
No chains or buyer fall-throughs
Fixed completion timescales

You can sell your inherited property with confidence and minimal disruption.

Conclusion

Inheriting a home can raise many questions, particularly around tax, but when it comes to Stamp Duty, the position is clear.

You do not have to pay stamp duty when you inherit a house, as an inherited property is transferred through an estate rather than purchased in the traditional sense.

However, even though stamp duty does not apply, an inherited property can still raise other financial considerations. Inheritance tax may be payable if the estate exceeds the relevant thresholds; income tax may still apply if the property generates rental income; and capital gains tax may apply if the inherited property increases in value before being sold. Understanding these distinctions allows you to make informed decisions and avoid unexpected liabilities.

For many people, managing or holding onto an inherited property is not always practical. Ongoing costs, tax deadlines, and the emotional weight of ownership can make selling the inherited property the most sensible option. In these situations, clarity, speed and certainty matter just as much as price.

If you are looking for a straightforward way to sell an inherited property, without delays or complications, We Buy Any House can help. With fast cash offers, no estate agent fees, and completion in as little as seven days, you can move forward with confidence and peace of mind.