Inheritance Tax Calculator UK 2025/26
Estimate IHT on your estate including the residence nil-rate band.
Property + savings + investments + possessions
IHT to Pay
None
Beneficiaries Receive
£500,000
Breakdown
UK Inheritance Tax 2025/26
IHT is charged at 40% on estates above the nil-rate band of £325,000. If you leave your main home to direct descendants, you also get the residence nil-rate band of £175,000 — giving a combined threshold of £500,000.
Married couples and civil partners can transfer unused nil-rate band to the surviving spouse, potentially doubling the threshold to £1,000,000. Gifts made more than 7 years before death are exempt.
About the Inheritance Tax Calculator
Inheritance Tax (IHT) is charged at 40% on the value of your estate above the Nil-Rate Band when you die. With property prices having risen dramatically while the threshold has been frozen since 2009, IHT now affects far more families than ever before. Proper planning can significantly reduce or eliminate the liability, but it requires understanding the various reliefs and exemptions available.
The Nil-Rate Band (NRB) is £325,000 per person — unchanged since 2009 and frozen until at least 2028. The Residence Nil-Rate Band (RNRB) adds up to £175,000 if you leave your home to direct descendants (children or grandchildren). Combined, a married couple can pass on up to £1 million tax-free, because any unused NRB and RNRB transfers to the surviving spouse. However, the RNRB is tapered away for estates over £2 million, losing £1 for every £2 above that threshold.
How to Use This Calculator
- Enter the total value of your estate (property, savings, investments, possessions)
- Deduct any liabilities (mortgages, debts, funeral costs)
- Indicate whether you are leaving your home to direct descendants (for RNRB)
- Add any lifetime gifts made in the last 7 years
- View the estimated IHT liability and explore planning strategies to reduce it
Key Facts
Gifts made more than 7 years before death are completely IHT-free. Gifts within 3-7 years benefit from taper relief, reducing the tax progressively. Transfers between spouses are always exempt regardless of value. Leaving 10% or more of your net estate to charity reduces the IHT rate from 40% to 36%. Business Property Relief can provide 50% or 100% relief on qualifying business assets, and Agricultural Property Relief works similarly for farming land and buildings.