Tax On Top Of Inheritance Tax

Is inheritance tax subject to capital gains tax?

No. Inheritance tax isn't subject to capital gains tax, but there can be slightly confusing interactions during the administration of the estate. For example, an asset may have been left by the deceased person at a given value. That value will have to be agreed by H.M. Revenue and Customs, and the inheritance tax payable on it if appropriate. Let's say that the asset grows in value over the period of administration. For example, maybe it's a house and the executor gets planning permission for redevelopment of the site and sells that half of the estate. There will be a gain within the estate, which will be the difference between the probate value of the property and the sale price to the developer. That gain will be subject to capital gains tax, not inheritance tax.

Is inheritance tax subject to income tax?

No. Inheritance tax and income tax are separate. Inheritance tax would be payable on the value of the assets in the estate, or in the death of the testator. When those assets are invested by the executor, interest may arise and income tax could be payable on that interest, but it won't affect the inheritance tax position.