Inheritance Tax is a tax imposed on the estate of a deceased person before the assets are distributed to their heirs. The amount of tax owed depends on the value of the estate and the relationship of the heirs to the deceased. Close relatives often pay a lower rate compared to distant relatives or non-relatives. In many countries, there are exemptions and thresholds that determine whether an estate is subject to Inheritance Tax. For example, if the total value of the estate is below a certain amount, no tax may be owed. This tax is designed to generate revenue for the government while addressing wealth transfer between generations.