Check if you can get an additional Inheritance Tax threshold

Find out whether an estate will qualify for an extra tax-free amount (the residence nil rate band (RNRB)).


If someone dies on or after 6 April 2017 and they owned their own home or share of one, their estate may be entitled to a higher threshold. This is the residence nil rate band (RNRB). The extra amount for 2019 to 2020 is up to £150,000. The maximum available amount will go up yearly.

To qualify, the person who died must have left their home, or a share of it, to their direct descendants.

A person does not have to leave the whole of the home to direct descendants. If they only inherit a share of the home, you calculate the available RNRB on the basis of the value of that share.

The estate may also qualify if the person downsized to a lower value property, or sold or gave away their home on or after 8 July 2015.


A woman dies in tax year 2020 to 2021. Her estate includes a home worth £500,000.

In her will she leaves half of the property to her step-son and half to her nephew.

You work out the available RNRB based on how much the property left to the step-son was worth (£250,000). But, the actual RNRB for the estate is restricted to £175,000. This is the lower of the maximum available RNRB for tax year 2020 to 2021 (£175,000) and value of the half share of the home (£250,000).

It does not matter how the step-son inherits the home. The home could be left to the step-son as a specific legacy in the will, or it could be included in what’s left of the estate (the residue) after specific legacies have been taken into account.

Homes that qualify

Only one home will qualify for the available RNRB. If the person who died owned and lived in more than one home, the executor can choose which one to use.

The person that died must have owned and lived in the property at some time. A property that they owned but never lived in, such as a buy-to-let, will not qualify for the RNRB.

You may be able to claim RNRB by claiming a downsizing addition if the person who died either:

  • did not own a home because they sold or gave it away on or after 8 July 2015
  • downsized to a less valuable home that’s below the maximum threshold on or after 8 July 2015

If the home, or the share of the home, was held in a trust before the person died or is transferred to a trust when they die, you may be able to claim the RNRB depending on the type of trust.

The home does not have to be in the UK but it does have to be within the scope of Inheritance Tax and it must be included in a person’s estate. This may depend on their domicile (where they’ve made their permanent home) and where the home is.

People that have made their permanent home in the UK (for example, they are domiciled in the UK) are subject to Inheritance Tax on their worldwide assets so it does not matter where the home is. People who are not domiciled in the UK are only subject to Inheritance Tax on their assets in the UK, so the home must be in the UK to be within the scope of Inheritance Tax and within their estate when they die. In these cases, the home will only qualify for the RNRB if it’s in the UK.

Work out the value of the home

To work out the value of the home, use the open market value of the home, less any debts such as a mortgage.

If the person who died only owned a share of the home, only include what their share was worth.

Work out the available RNRB

Use the RNRB calculator to work out how much RNRB the estate may be entitled to. The calculator will partly complete the form IHT435 for you.

The amount will be the lower of the:

  • value of the home, or share inherited by the direct descendants
  • maximum RNRB available when the person died

If an estate is worth more than £2 million, the amount the estate is entitled to is reduced or tapered away by £1 for every £2 over £2 million.

How to use the RNRB

You subtract the RNRB from the value of the whole estate, not just the value of the home.

The RNRB includes any unused RNRB transferred from a husband, wife or civil partner.

How to claim the RNRB

You should give details of the amount you want to use and any supporting information on the IHT400 account form and the form IHT435.

Published 6 April 2017
Last updated 5 September 2019 + show all updates
  1. The additional threshold has been renamed residence nil rate band (RNRB).

  2. First published.