The number of families paying the 40pc charge on substantial gifts has more than doubled from 590 in 2011-12, suggesting that families are scrambling to give away their wealth in an effort to bring their estates below the £325,000 threshold.
Soaring asset prices have forced more families over this tax-free allowance which is frozen until 2028. Couples leaving their home to their children on death get a higher £1m threshold.
Collectively, 1,300 families paid £256m in death duties on large gifts, up from £101m in 2011-12 – a real terms increase of 119pc, according to wealth manager Evelyn Partners, who obtained the data.
Ian Dyall, of Evelyn Partners, said: “These figures show that a growing number of recipients will have had a potentially unexpected inheritance tax bill to pay when the donor dies, on a gift that they could have received several years ago. How many had the liquid assets available to pay it? How many had invested the money in illiquid assets like a new home?”
He added: “What we could be seeing here is more families over the years making large lifetime gifts because they want to support their children or grandchildren.
“Among some families there could be a growing awareness that such gifts could reduce the size of their estate so it’s a conscious tactic – but the gifter just doesn’t live long enough for the estate to reap the full tax benefit.”