🏛️Inheritance Tax Calculator (UK)

About this tool

Enter the estate's total value and debts, how much of the home goes to children or grandchildren, and anything left to a spouse, civil partner or charity. If a late spouse didn't use their allowances, add the percentage transferred. You'll see the tax-free allowance, the taxable estate, the inheritance tax due and what passes to beneficiaries.

How UK inheritance tax is worked out

Inheritance tax (IHT) is charged on the estate of someone who has died: property, savings, investments and possessions, minus debts and funeral costs. Everyone has a nil-rate band of £325,000. On top of that, the residence nil-rate band of up to £175,000 applies when a home, or the proceeds of one, passes to direct descendants: children, stepchildren, adopted or foster children and grandchildren. It is reduced by £1 for every £2 the estate exceeds £2 million, and disappears above £2.35 million. Anything left to a spouse, civil partner or charity is exempt, and a surviving spouse can inherit their partner's unused bands. That's how a married couple can pass on up to £1 million tax-free. Tax is 40% on the amount above the allowances, or 36% if at least 10% of the net estate goes to charity. For example, a £600,000 estate including a £350,000 home left to children has £500,000 of allowances, so IHT is 40% of £100,000, which is £40,000. Lifetime gifts are usually free of IHT if the giver survives seven years, and some gifts are exempt immediately, such as £3,000 a year, small gifts and gifts from surplus income. Honest limits: trusts, business and agricultural property relief, gifts with reservation and, from April 2027, unused pension funds can all change the bill. The thresholds are frozen until 2030, and this isn't legal or tax advice. The capital gains tax calculator and the net worth calculator are related.

Frequently asked questions