Property price increases over the past seven years have continued to push the average house price ever closer past the nil rate band of the inheritance tax (IHT) threshold, which raises the concern for many about the potential for a significant tax liability in the future if there is no provision.

According to a report from PWC (Price Watehouse Coopers), the professional services firm, since 1997 the ratio of the average house price to the IHT threshold has increased steadily from 32 per cent to around 65 per cent today. In London the increase in this ratio has been more dramatic from 49 per cent in 1997 to 103 per cent today.