Inheritance tax, made clear.
Inheritance tax catches more families every year. Understanding how it works, and planning early, is the key to protecting more of what you pass on.
Accredited & Regulated
How much can you pass on tax free?
Inheritance tax is charged at 40% on the part of an estate that sits above your tax-free allowances. For the 2025/26 tax year every person has a nil-rate band of £325,000, plus a residence nil-rate band of £175,000 when a main home passes to children or grandchildren.
Combined, that's up to £500,000 per person, or £1 million for a married couple or civil partners, who can transfer unused allowances between them. These thresholds are frozen until April 2031, so as house prices rise, more ordinary families are being drawn into inheritance tax each year.
- ✓ £325,000 nil-rate band for every estate
- ✓ £175,000 residence band for passing on a home
- ✓ Up to £1 million tax free for couples
- ✓ 40% on anything above your allowances (36% if 10%+ goes to charity)
What inheritance tax actually looks like
A simple illustration using the 2025/26 thresholds.
A family home worth £450,000 plus £300,000 in savings and investments, left to two children.
£325,000 nil-rate band plus £175,000 residence band, because the home passes to direct descendants.
40% of the £250,000 above the allowance. With planning, a bill like this can often be reduced.
Figures are illustrative for the 2025/26 tax year. A married couple leaving everything to each other and then to their children could pass on up to £1 million before any tax applies.
How we help reduce your IHT
A clear, structured process to protect more of your estate.
Review your estate
We build a complete picture of your assets, property and liabilities to establish your potential IHT exposure.
Identify allowances & reliefs
We apply all the allowances, bands and reliefs you're entitled to, so nothing is left on the table.
Build a tailored plan
We recommend a practical strategy, which may include gifting, trusts and updates to your will.
Implement & review
We put the plan in place and review it over time as your circumstances and the rules evolve.
Inheritance tax FAQs
The standard nil-rate band is £325,000 per person. An additional residence nil-rate band of £175,000 applies when a main home is left to direct descendants, giving up to £500,000 per person, or £1 million for a married couple. These thresholds are frozen until April 2031.
Inheritance tax is charged at 40% on the value of an estate above the available allowances. If you leave at least 10% of your net estate to charity, the rate on the rest falls to 36%.
Yes. You can give away up to £3,000 a year free of inheritance tax, plus smaller gifts and gifts out of surplus income. Larger gifts are usually free of tax if you survive seven years, with the tax tapering down over that period. We help you gift safely and keep the records HMRC expects.
Yes, your home is part of your estate and is often the asset that pushes an estate over the threshold. The residence nil-rate band can add up to £175,000 of allowance when the home passes to children or grandchildren, though it tapers away for estates over £2 million.
Inheritance tax is usually due by the end of the sixth month after the person died, and often before the Grant of Probate is issued. Interest is charged on late payments. We help executors plan for this, including options for paying tax on property in instalments.
Trusts can move assets out of your estate, protect them for future generations and give you control over how and when beneficiaries receive them. We assess whether a trust suits your goals as part of wider estate planning.
Let us be your trusted guide
Take the first step towards settling the estate with confidence. Begin your Probate application today.