What is the IHT nil-rate band?

Every individual has a nil-rate band (NRB) of £325,000 — the portion of the estate that is exempt from IHT. Unused NRB can be transferred to a surviving spouse.

What is the residence nil-rate band?

The RNRB is an additional £175,000 allowance available when a main residence is passed to direct descendants (children or grandchildren). Combined with the NRB, a couple can shelter up to £1 million.

Does the residence nil-rate band reduce for large estates?

Yes. The residence nil-rate band tapers by £1 for every £2 the estate is worth above £2,000,000. Worked example: an estate of £2,200,000 is £200,000 over, so the £175,000 allowance is cut by £100,000 to £75,000. At £2,350,000 or more it is gone entirely. The calculator applies this taper automatically.

Are gifts made before death subject to IHT?

Chargeable gifts made within 7 years of death use up the nil-rate band first. Gifts to individuals are exempt after 7 years (potentially exempt transfers, or PETs).

Inheritance Tax Calculator 2026/27

Estimate the IHT payable on an estate using the standard nil-rate band (£325,000) and residence nil-rate band (£175,000 where applicable). IHT is charged at 40% on the taxable estate.

UK rates for the 2026/27 tax year · last checked against GOV.UK on 6 April 2026

How it's calculated

Taxable estate = Estate value − Nil-rate band − RNRB − Chargeable gifts
IHT = Taxable estate × 40%

Residence nil-rate band since 2017

The residence nil-rate band was introduced in April 2017 at £100,000 and rose by £25,000 a year to £175,000 in April 2020, where it has been frozen since. The standard nil-rate band has been £325,000 since April 2009. Both are frozen until April 2030, so more estates cross the threshold each year as house prices rise. The chart is drawn from the same table the calculator uses.

Residence nil-rate band by tax year

Show the figures as a table

From	Residence nil-rate band
2017/18	£100,000
2018/19	£125,000
2019/20	£150,000
2020/21	£175,000

Rates and sources

This calculator uses UK rates for the 2026/27 tax year, last checked against GOV.UK on 6 April 2026.

Inheritance Tax thresholds, rates and allowances — official guidance:

Rates change, usually at the start of a tax year in April. Always confirm against GOV.UK before relying on a figure for a filing or a financial decision.

Frequently Asked Questions

What is the IHT nil-rate band?: Every individual has a nil-rate band (NRB) of £325,000 — the portion of the estate that is exempt from IHT. Unused NRB can be transferred to a surviving spouse.
What is the residence nil-rate band?: The RNRB is an additional £175,000 allowance available when a main residence is passed to direct descendants (children or grandchildren). Combined with the NRB, a couple can shelter up to £1 million.
Does the residence nil-rate band reduce for large estates?: Yes. The residence nil-rate band tapers by £1 for every £2 the estate is worth above £2,000,000. Worked example: an estate of £2,200,000 is £200,000 over, so the £175,000 allowance is cut by £100,000 to £75,000. At £2,350,000 or more it is gone entirely. The calculator applies this taper automatically.
Are gifts made before death subject to IHT?: Chargeable gifts made within 7 years of death use up the nil-rate band first. Gifts to individuals are exempt after 7 years (potentially exempt transfers, or PETs).