Quick answer
Inheritance tax is charged on the estate of the person who has died, and it is usually paid by the estate before anything is distributed, rather than by you as the beneficiary. Whether any is due depends on the value of the whole estate against the available allowances.
Guidance for United Kingdom. General information, not legal advice.
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My mother has left me her house and some savings in her will. I am worried about a large tax bill. Will I have to pay inheritance tax on what I receive?
Inheritance tax is charged on the estate of the person who has died, and it is usually paid by the estate before anything is distributed, rather than by you as the beneficiary. Whether any is due depends on the value of the whole estate against the available allowances. Everyone has a nil-rate band, currently 325,000 pounds, below which no inheritance tax is charged, and there is an additional residence nil-rate band, currently up to 175,000 pounds, which can apply when a home is left to direct descendants such as children. Anything left to a spouse or civil partner is generally exempt, and unused allowance can often pass between spouses. Above the available allowances the rate is 40 percent. These thresholds are frozen for the next few years, so it is worth checking the current figures when the time comes.
In short, you personally do not normally hand over inheritance tax on money or a house you inherit; the executor deals with any tax from the estate first. What you should be aware of is what happens afterwards: income the inherited assets later produce, such as interest or rent, is taxable in the normal way, and if you sell an inherited asset that has risen in value since the date of death you could face capital gains tax on the increase. The position can get complex with larger estates, gifts made before death, or trusts, so it is sensible to take advice if any of those apply. General information only.
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