Inheritance Tax Calculator 2024/25
Estimate your UK inheritance tax liability. Includes the Nil Rate Band (£325,000), Residence Nil Rate Band (£175,000), transferable allowances for married couples and civil partners, RNRB tapering for estates over £2M, and the reduced 36% rate for charitable legacies.
Inheritance Tax Calculator
Estimate UK IHT based on estate value, residence, and available reliefs
Market value of all assets including property, investments, and cash
Value of main home — required for RNRB (Residence Nil Rate Band)
Allows transfer of unused NRB — effectively doubles the threshold
Children, grandchildren — required for Residence Nil Rate Band (£175,000 per person, up to £350,000 if married)
Legacies to qualifying charities. If ≥ 10% of net estate, IHT rate reduces from 40% to 36%
5 Key IHT Planning Tips
- 7-year rule: Gifts to individuals become fully exempt from IHT if you survive 7 years after making them (taper relief reduces the charge in years 3–7).
- Potentially Exempt Transfers (PETs): Start gifting assets early — £3,000 annual exemption + £250 small gifts per recipient are immediately exempt every tax year.
- AIM shares & Business Property Relief (BPR): Qualifying AIM-listed shares and unlisted trading businesses can attract 100% BPR, reducing IHT to zero after 2 years of ownership.
- Trusts: Discretionary trusts can remove assets from your estate while retaining some control. Seek specialist legal advice — trust taxation has its own rules.
- Spouse exemption: Assets left to a spouse or civil partner are 100% exempt from IHT. Their unused NRB and RNRB can be transferred to you, potentially giving a combined threshold of £1,000,000.
How Inheritance Tax Works in the UK
Inheritance tax (IHT) is charged at 40% on the value of an estate above the available thresholds. The standard Nil Rate Band is £325,000. Married couples and civil partners can transfer any unused NRB, giving a combined NRB of up to £650,000.
Residence Nil Rate Band
An additional allowance of £175,000 per person (2024/25) applies when a main residence is passed to direct descendants. For married couples this can total £350,000, bringing the combined maximum threshold to £1,000,000. The RNRB tapers at £1 per £2 of estate above £2 million.
Charitable Donations
Leaving at least 10% of your net estate to qualifying charities reduces the IHT rate on the remainder from 40% to 36%. HMRC publishes a list of qualifying charities on gov.uk.
When Is IHT Due?
IHT is normally paid by the executor and must be paid within 6 months of the end of the month of death. Interest accrues after that date. Property can sometimes be paid in 10 annual instalments.