Nil rate band for individuals*
Thereafter – lifetime gifts**
– lower rate on death***
– on death
Residence nil rate band****
* Unused nil rate band can be used by surviving spouse or civil partner. This band is currently frozen until April 2026.
** Increased to 40%, subject to tapering relief, on gifts made between 3 and 7 years pre death. Certain lifetime gifts are exempt. Special rules for business property.
*** A lower rate applies where 10% or more of the net estate is left to charity.
**** The inheritance tax main residence nil rate band (MRNRB) came into effect in April 2017. The MRNRB allows for a £175,000 per person transferable allowance for married couples and civil partners when their main residence is passed down to children after their death. The MRNRB is in addition to the £325,000 inheritance tax threshold.
Years before death
% of death charge
Main exempt lifetime gifts
Recurring annual gifts out of surplus income
Annual gifts out of capital (with one year carry forward if unused)
Small gifts (per recipient)
Parental gift on marriage
Grandparent or party to marriage
Other gifts on marriage (per donor)
Business Property Relief
Shares in unquoted companies (including USM/AIM stocks)
Shares in quoted companies
– shareholding up to 50%
– shareholding over 50%
Unincorporated business or interest in a business
Land, buildings, plant and machinery used in the deceased’s business/company
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