Calculate the potential Inheritance Tax (IHT) liability on your estate using current UK rates and allowances.
Inheritance Tax (IHT) is a tax on the estate of someone who has died. It's paid from the estate before any inheritance is distributed to beneficiaries. The current threshold is £325,000 - estates below this value pay no IHT.
Gifts made more than 7 years before death are exempt from IHT. Gifts made within 7 years may be subject to taper relief:
| Years Before Death | Tax Reduction |
|---|---|
| 0-3 years | 0% (full 40%) |
| 3-4 years | 20% reduction |
| 4-5 years | 40% reduction |
| 5-6 years | 60% reduction |
| 6-7 years | 80% reduction |
From 6 April 2027, most unused defined contribution pension funds and pension death benefits will be brought into the value of your estate for Inheritance Tax purposes. Death-in-service benefits and dependants' scheme pensions from defined benefit or collective money purchase arrangements are expected to remain excluded. This is a confirmed future change - this calculator does not yet include pension assets, so estates with significant pension wealth should seek updated advice.
| Nil-Rate Band | £325,000 |
| Residence NRB | £175,000 |
| Maximum (couple) | £1,000,000 |
| Standard Rate | 40% |
| Charity Rate | 36% |
Rates for 2026/27 tax year