In England and Wales you can generally inherit up to £325,000 from one person's estate before any inheritance tax is due, and a married couple or civil partners leaving a home to their children or grandchildren can pass on up to £1,000,000 tax free. Anything above the available thresholds is usually taxed at 40% (gov.uk/inheritance-tax, as at August 2026, subject to change).
One point is worth clearing up first, because it shapes every answer below. In the UK, inheritance tax is charged on the estate of the person who has died, not on each beneficiary. So there is no personal cap on the amount you can receive as an individual. What matters is the size of the estate and which allowances it can use. This guide sets out those allowances, the gifts that fall outside the tax, and what happens above the line. Figures are current as at August 2026 and are subject to change.
How much can you inherit tax free?
For a single person, the first £325,000 of an estate is free of inheritance tax. This is the nil-rate band. A further residence nil-rate band of up to £175,000 can apply where a main home passes to direct descendants, such as children, stepchildren or grandchildren, which lifts a single person's potential tax-free total to £500,000 (gov.uk, passing on a home, as at August 2026, subject to change). Because unused allowances can pass to a surviving spouse or civil partner, a couple can combine both sets, giving a potential tax-free total of up to £1,000,000.
The tax-free thresholds at a glance
The two main allowances are the nil-rate band and the residence nil-rate band. The table shows the headline figures and how they combine.
| Allowance or rate | Level (August 2026) | Notes |
|---|---|---|
| Nil-rate band | £325,000 | Per person. Applies to every estate. |
| Residence nil-rate band | Up to £175,000 | Per person, where a home passes to direct descendants. |
| Single person, home to descendants | Up to £500,000 | £325,000 plus £175,000. |
| Married couple or civil partners | Up to £1,000,000 | Both bands transferable to the survivor. |
| Standard inheritance tax rate | 40% | On the value above the available thresholds. |
| Reduced rate (10%+ of net estate to charity) | 36% | Where at least 10% of the net estate passes to charity. |
Source: gov.uk/inheritance-tax and gov.uk, passing on your home. The nil-rate band, residence nil-rate band and £2,000,000 taper threshold are frozen until 5 April 2031 (gov.uk, as at August 2026, subject to change).
The residence nil-rate band and the £2 million taper
The residence nil-rate band is an extra allowance of up to £175,000 that applies when a main residence, or a share of one, passes to direct descendants. It sits on top of the £325,000 nil-rate band. There is an important limit. The residence nil-rate band is reduced by £1 for every £2 by which the estate is worth more than £2,000,000, so larger estates may receive a smaller allowance or none at all (gov.uk, as at August 2026, subject to change). Estates that have never owned a home, or that leave property to someone other than a direct descendant, may not qualify for this band.
Passing between spouses and civil partners
Transfers between spouses and civil partners who are both UK domiciled are generally free of inheritance tax, with no upper limit (gov.uk, as at August 2026, subject to change). Just as important, any part of the nil-rate band and residence nil-rate band that is not used on the first death can transfer to the survivor. This is why a couple can reach a combined tax-free figure of up to £1,000,000, while two unmarried people cannot transfer allowances between them in the same way. Getting the wording of a will right is what allows these allowances to be claimed cleanly.
Gifts you can make tax free
Alongside the thresholds that apply on death, several lifetime gifts fall outside inheritance tax. Used over time, these allowances can reduce the value of an estate as part of wider estate planning. The main ones are set out below.
| Type of gift | Tax-free amount |
|---|---|
| Annual exemption | £3,000 per tax year (one year's unused allowance can be carried forward) |
| Small gifts | £250 per person, per tax year, to as many people as you like |
| Wedding or civil partnership gift, to a child | £5,000 |
| Wedding or civil partnership gift, to a grandchild or great-grandchild | £2,500 |
| Wedding or civil partnership gift, to anyone else | £1,000 |
| Normal gifts out of surplus income | No fixed limit, subject to the conditions being met |
Source: gov.uk/inheritance-tax/gifts, as at August 2026, subject to change.
Larger gifts to individuals are usually potentially exempt transfers. They fall outside the estate if you live for seven years after making them. If death occurs within seven years, the gift may count towards the estate, though taper relief can reduce the tax due on gifts made three to seven years before death (it reduces the tax on the gift, not its value). Taper relief only comes into play where total gifts in those seven years exceed the £325,000 threshold (gov.uk, as at August 2026, subject to change).
What happens above the threshold?
Inheritance tax is charged only on the part of an estate that sits above the available allowances, not on the whole estate. The standard rate is 40%. A reduced rate of 36% applies where at least 10% of the net estate is left to charity (gov.uk/inheritance-tax, as at August 2026, subject to change). Because estate values have risen while the thresholds stay fixed, more families may find part of an estate falls above the line over time, which is one reason people look at inheritance tax planning earlier.
Changes worth knowing about
Three announced changes affect how much can pass tax free in the coming years.
- Frozen thresholds. The nil-rate band, residence nil-rate band and £2,000,000 taper threshold are fixed until 5 April 2031 (gov.uk, as at August 2026, subject to change).
- Pensions. From 6 April 2027, most unused pension funds and death benefits are due to be brought within the value of the estate for inheritance tax, an announced change from the Autumn Budget 2024 (gov.uk, Inheritance Tax on pensions technical note, as at August 2026, subject to change).
- Farms and businesses. From 6 April 2026, agricultural property relief and business property relief give 100% relief on the first £2,500,000 of combined qualifying property per person, and 50% above that. The £2,500,000 allowance is transferable between spouses and civil partners, up to £5,000,000 for a couple (gov.uk news release, 23 December 2025; gov.uk, summary of reforms to APR and BPR, as at August 2026, subject to change).
Scotland and Northern Ireland
Inheritance tax is a UK-wide tax, so the thresholds above apply across the United Kingdom. The surrounding succession rules differ by nation. Scotland has its own law, including legal rights that can give a spouse and children a fixed share of an estate, and it uses confirmation rather than a grant of probate. Northern Ireland has a separate but broadly similar system to England and Wales. Where an estate touches more than one jurisdiction, it can be worth taking advice in each.
Frequently asked questions
How much can you inherit without paying tax in the UK?
Up to £325,000 from one person's estate is free of inheritance tax, and up to £500,000 for a single person whose home passes to direct descendants. A married couple or civil partners can pass on up to £1,000,000 by combining both allowances. Anything above the available thresholds is usually taxed at 40% (gov.uk, as at August 2026, subject to change).
Do I pay inheritance tax on money I receive?
In the UK, inheritance tax is charged on the estate of the person who has died, not on the individual who inherits. So there is generally no personal cap on what you can receive, and beneficiaries do not usually pay inheritance tax on their share directly. Other taxes, such as income tax on interest earned afterwards, may apply separately (gov.uk, as at August 2026, subject to change).
How much can a married couple inherit tax free?
A married couple or civil partners can pass on up to £1,000,000 free of inheritance tax where a home passes to direct descendants, by combining two nil-rate bands of £325,000 and two residence nil-rate bands of up to £175,000. Unused allowances transfer to the survivor. The residence band reduces for estates worth more than £2,000,000 (gov.uk, as at August 2026, subject to change).
How much can you inherit from your parents tax free?
The tax-free amount depends on the parent's estate, not on the child, because inheritance tax is charged on the estate. A parent's estate can use a £325,000 nil-rate band, plus up to £175,000 where the family home passes to children or grandchildren. A surviving parent's estate may also use a late spouse's unused allowances (gov.uk, as at August 2026, subject to change).
How much can you gift tax free each year?
You can give away £3,000 in total each tax year under the annual exemption, and one year's unused allowance can be carried forward. Separately, you can give £250 to as many individuals as you like, along with wedding gifts and normal gifts out of surplus income. Larger gifts may fall outside the estate if you live for seven years (gov.uk, as at August 2026, subject to change).
Is there inheritance tax between husband and wife?
Transfers between spouses and civil partners who are both UK domiciled are generally free of inheritance tax, with no upper limit. Any unused nil-rate band and residence nil-rate band can also pass to the survivor, which is what allows a couple to reach a combined tax-free total of up to £1,000,000 (gov.uk, as at August 2026, subject to change).