IHTM25536 - AR/BR 100% relief allowance: transfer of unused allowance- reviewing form IHT 437

Form IHT 437 is designed to obtain information so the taxpayer can calculate the amount of transferable 100% relief allowance that is available.   

Where the first spouse or civil partner died before 6 April 2026 the full 100% relief allowance is transferable.    

Where the first spouse or civil partner died on or after 6 April 2026 check that the documents listed on the IHT 437 have been provided, and if not request these from the personal representatives. Check the terms of the will, intestacy provisions or any instruments of variation etc and if: 

  • they left all their assets to their surviving spouse or civil partner either under the will, intestacy or otherwise and   

  • they made no chargeable transfers of property that would have qualified for 100% agricultural or business property relief,   

the full 100% relief allowance is transferable.   

In either of the above situations as long as the amount claimed does not exceed the total of the 100% relief allowance at the death of the first spouse or civil partner and the surviving spouse or civil partner no further checks are required.     

For any other claims you will need to review the information provided on form IHT437 to calculate how much of the 100% relief allowance was used on the first death (IHTM25532). 

Example 

Joan dies on 10 January 2015 leaving a surviving spouse, John. When John dies on 10 March 2027 his estate includes a business worth £5.1 million.   

John has a 100% relief allowance of £2.5 million.  As Joan died before 6 April 2026 her full 100% relief allowance will be available to transfer to John, giving him a 100% relief allowance of £5 million.   

If Joan had died on 7 April 2026 leaving her whole estate to John and she had made no lifetime gifts in the seven years before her death then none of her 100% relief allowance would have been used in her estate and her full £2.5million allowance would have transferred to John.   

John will therefore have a total of £5million 100% relief allowance and the business in worth £5.1m, so the balance of £100,000 qualifies for 50% relief.  

If in the example above Joan had died on 7 April 2026 and she had made lifetime gifts of relievable property on or after 30 October 2024 these will need to be taken into account when working out how much of the allowance had been used on Joan’s death. Gifts made before 30 October 2024 are not affected by the allowance so would not be taken into account.