UK Inheritance Tax Calculator
UK Inheritance Tax is charged at 40% on the value of your estate above your available nil-rate bands. This calculator works out your potential IHT bill using the standard £325,000 nil-rate band and the Residence Nil-Rate Band (RNRB) if leaving a home to direct descendants.
Educational estimate. Calculator results are for planning and information only, not financial, tax, medical, legal, or engineering advice. Verify important decisions with official sources or a qualified professional.
UK Inheritance Tax Calculator
Estate IHT — Nil-Rate Band & RNRB
📐 Formula & Method
IHT Calculation
NRB = £325,000 (doubled to £650,000 for married couples using transferred NRB). RNRB = £175,000 per person if leaving home to direct descendants (subject to taper for estates above £2m).
📋 How to Use
-
1
Enter total estate value.
-
2
Enter property value.
-
3
Confirm whether leaving home to descendants and marital status.
-
4
See estimated IHT liability and effective rate.
UK Inheritance Tax — Planning to Minimise IHT
Only around 4-5% of UK estates pay IHT, but the proportion is growing as property prices rise against frozen nil-rate bands (frozen until 2028). Strategies to reduce IHT include making gifts (gifts survive 7 years become fully exempt), pension contributions (pensions are outside the estate), and life insurance written in trust.
The Residence Nil-Rate Band (RNRB) of £175,000 is available when you leave a qualifying residential property to direct descendants (children, grandchildren). Combined with the standard NRB and the ability to transfer unused allowances from a deceased spouse, a married couple can potentially shelter up to £1m from IHT.
🔬 Methodology & Accuracy
Formula: Uses the standard mathematical formula shown in the Formula & Method section above. All computations run client-side in your browser — no data is sent to our servers.
Data sources: Tax bands, contribution limits and regulatory rates are taken from official US (IRS, SSA) and UK (HMRC, gov.uk) publications for the current tax year, and updated when bands change.
Last reviewed: January 2025 · Accuracy: Results are precise to two decimal places using IEEE-754 double-precision arithmetic. Intended for educational and planning use only.
For informational purposes only. Results are estimates based on the inputs and formulas provided. For financial, tax, medical, or legal decisions, consult a qualified professional. Rates and regulations change — always verify current figures with official sources.