Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Inheritance tax definition

What does Inheritance tax mean? Inheritance tax describes the taxation of wealth transfers on death and, in defined cases, on lifetime gifts and trust transfers. In the UK (England & Wales, Scotland and Northern Ireland), Inheritance Tax is a statutory regime under the Inheritance Tax Act 1984, charged at rates up to 40% on transfers of value. It is usually payable from the deceased’s estate by personal representatives. Lifetime charges arise on chargeable lifetime transfers (typically gifts into most trusts) and where a donor dies within seven years of a potentially exempt transfer. Key features include the nil-rate band and, where conditions are met,...

UK Inheritance Tax—Residence Nil Rate Band: eligibility, calculation, tapering, downsizing, trusts, transferable RNRB, planning and claims

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Practice notes

Residence nil rate band (RNRB)

This Practice Note outlines the residence nil rate band (RNRB), once called the additional threshold and also referred to as the residential nil rate band or residential property nil rate band. It sets out what the RNRB is, when it can apply, how the figure is worked out and also the process for claiming it in practice. Although this Practice Note includes some links to worked examples, customers are directed to Practice Note: Q&As for extensive links to Q&As and worked examples showing how the RNRB operates across different practical situations and various scenarios in practice. The RNRB sits alongside the basic NRB and can further cut the Inheritance tax (IHT) due on death. It is set against the taxable value of the estate, but unlike the basic NRB it is confined to being applied only to:

the value of a residential property interest
the estate on death, and
the inheritance of lineal descendants
estates not exceeding the upper taper threshold

The RNRB was brought in by the Finance (No 2) Act 2015 (F(No 2)A 2015), refined by the Finance Act 2016 (FA 2016), with minor technical changes made by the Finance Act 2019 (FA 2019)....

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Web page updated on 22/05/2026

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