Inheritance Tax Calculator (IHT) — 2026/27
What is the Inheritance Tax Calculator?
UK Inheritance Tax (IHT) is paid on a deceased person's estate above the nil-rate band. The standard nil-rate band is £325,000 (frozen until April 2030). An additional residence nil-rate band of £175,000 applies when the home passes to direct descendants. The rate above thresholds is 40% (or 36% if 10%+ of the net estate is left to charity).
Last reviewed: against HMRC rates for 2024/25 & 2025/26.
Inheritance Tax thresholds — 2026/27
Worked example
An £800,000 estate including a £400,000 home passing to children: £325k NRB + £175k RNRB = £500k tax-free; £300k × 40% = £120,000 IHT.
Frequently asked questions
+How much can I inherit tax-free in 2025/26?
Up to £500,000 per individual when including the £325,000 nil-rate band and the £175,000 residence nil-rate band. Married couples and civil partners can combine allowances for up to £1m.
+What is the residence nil-rate band?
An additional £175,000 allowance available when a main residence is passed to direct descendants (children, grandchildren). It tapers away by £1 for every £2 of estate value above £2m.
+Can I pass everything to my spouse tax-free?
Yes — transfers between UK-domiciled spouses or civil partners are 100% exempt from IHT, and any unused nil-rate band transfers to the surviving partner's estate.
+What gifts are exempt from IHT?
£3,000 annual exemption, small gifts up to £250 per recipient, wedding gifts (varying limits), and gifts out of normal income. Other gifts become exempt after surviving 7 years (taper relief between years 3–7).