Residence Nil-Rate Band: UK Statistics 2026

Q: How much does the residence nil-rate band shelter from tax?

The residence nil-rate band sheltered 7.79 billion pounds of chargeable estate value in the 2023 to 2024 tax year across the UK. That was larger than the 7.03 billion pounds of Inheritance Tax liabilities created in respect of deaths in the same year, which makes the band one of the most significant reliefs by value removed from the tax base.

Q: How much is the residence nil-rate band in 2026?

The residence nil-rate band is 175,000 pounds per person in the 2026 to 2027 tax year. With a home passing to direct descendants it lifts the tax-free amount to 500,000 pounds for one person, and up to 1,000,000 pounds for a couple who combine two nil-rate bands and two residence bands. It has been 175,000 pounds since the 2020 to 2021 tax year.

Q: Is the residence nil-rate band frozen?

Yes. The residence nil-rate band has been frozen at 175,000 pounds since April 2020, and the standard nil-rate band at 325,000 pounds since April 2009. Both are frozen until 5 April 2031, the end of the 2030 to 2031 tax year, after the freeze was extended a further year at Budget 2025 on 26 November 2025.

Q: When is the residence nil-rate band withdrawn?

The residence nil-rate band is reduced by 1 pound for every 2 pounds that an estate is worth above the 2 million pound taper threshold. On that basis the full 175,000 pound band is removed once an estate reaches 2.35 million pounds, or 2.7 million pounds for a couple using both residence bands.

Q: Why are Inheritance Tax receipts rising?

Inheritance Tax receipts reached a record 8.2 billion pounds in the 2024 to 2025 tax year, up from 7.5 billion pounds the year before. HMRC attributes the continued growth to rising asset values combined with decisions to maintain the tax-free thresholds, so more estates exceed frozen bands as prices rise.

Q: What share of deaths pay Inheritance Tax?

In the 2023 to 2024 tax year, 4.72 percent of UK deaths resulted in an Inheritance Tax charge. The share has moved between about 3 percent and 6 percent in recent decades and is forecast to rise to 6.3 percent by the 2028 to 2029 tax year, which the Institute for Fiscal Studies notes would be the highest since the 1970s.

Q: Does the residence nil-rate band vary by region?

The band is a single national figure of 175,000 pounds, but because it is tied to a home its practical reach varies with local house prices. In May 2026 the average home cost 164,000 pounds in the North East, within a single person's band, but 545,000 pounds in London, above even a couple's combined 350,000 pound property allowance. HMRC does not publish take-up by region.

The residence nil-rate band is the newest and least understood part of the Inheritance Tax system in England and Wales. Introduced in April 2017, it adds up to £175,000 per person to the tax-free amount, but only where a home passes to direct descendants and only below a £2 million estate ceiling. This briefing sets out what the published data shows about how the relief is used, what it shelters, and where its fixed cash value has been overtaken by house prices.

Every statistic below states its figure, its tax year or date, its geography and its source. Inheritance Tax is a UK-wide tax, so HMRC and Office for Budget Responsibility figures are UK-wide; the legal framing in this briefing is England and Wales, the default jurisdiction for Fairchild Oldfield. Figures are current as at July 2026 and are subject to change.

Executive summary

31,000 estates used the residence nil-rate band (RNRB) in the 2023 to 2024 tax year, sheltering £7.79 billion of chargeable estate value across the UK (HMRC, released 30 July 2026).
30,400 estates incurred an Inheritance Tax charge in the 2023 to 2024 tax year, equal to 4.72% of UK deaths (HMRC, released 30 July 2026).
The RNRB is set at £175,000 per person, rising to a £500,000 tax-free amount with a home passing to descendants and up to £1,000,000 for a couple combining both allowances (gov.uk, as at July 2026).
The RNRB has been frozen at £175,000 since the 2020 to 2021 tax year and is now frozen until 5 April 2031, after the freeze was extended a further year at Budget 2025 (gov.uk).
Inheritance Tax receipts reached a record £8.2 billion in the 2024 to 2025 tax year, up from £7.5 billion in 2023 to 2024 (HMRC receipts bulletin).
The average UK house price was £271,000 in May 2026, ranging from £164,000 in the North East to £545,000 in London (HM Land Registry, UK House Price Index: UK summary, May 2026).
The share of UK deaths resulting in an Inheritance Tax charge is forecast to rise to 6.3% by the 2028 to 2029 tax year, the highest level since the 1970s (Institute for Fiscal Studies, citing OBR).
The RNRB above a £2 million estate is withdrawn at £1 for every £2, removing the full £175,000 once an estate reaches £2.35 million, or £2.7 million for a couple using both bands (gov.uk).

The evidence

Key findings

Each finding is a self-contained statement with its figure, tax year, geography and source. Where a figure is uncertain or not directly comparable, that is flagged.

31,000 estates used the residence nil-rate band in the 2023 to 2024 tax year across the UK. Source: HMRC, Inheritance Tax liabilities statistics: commentary, released 30 July 2026.
£7.79 billion of chargeable estate value was sheltered by the RNRB in the 2023 to 2024 tax year across the UK. Source: HMRC, released 30 July 2026.
30,400 estates incurred an Inheritance Tax liability in the 2023 to 2024 tax year, equal to 4.72% of UK deaths. Source: HMRC, released 30 July 2026.
£7.03 billion of Inheritance Tax liabilities were created in respect of deaths in the 2023 to 2024 tax year across the UK. Source: HMRC, released 30 July 2026.
The RNRB was £175,000 per person in the 2023 to 2024 tax year, unchanged since the 2020 to 2021 tax year. Source: gov.uk, Rates and allowances.
A qualifying estate can pass up to £500,000 tax free where a home goes to direct descendants, and up to £1,000,000 for a surviving spouse or civil partner using both bands, in the 2026 to 2027 tax year. Source: gov.uk.
The RNRB is reduced by £1 for every £2 that an estate exceeds the £2 million taper threshold. Source: gov.uk.
5,560 estates above the nil-rate band used the spouse or civil partner exemption in the 2023 to 2024 tax year, transferring £6.8 billion, a rise of 490 estates on the prior year. Source: HMRC, released 30 July 2026.
Business property relief sheltered £3.85 billion across 4,060 estates, and agricultural property relief £2.11 billion across 2,140 estates, in the 2023 to 2024 tax year. Source: HMRC, released 30 July 2026.
Inheritance Tax receipts reached a record £8.2 billion in the 2024 to 2025 tax year across the UK. Source: HMRC receipts bulletin.
The OBR forecasts Inheritance Tax will raise £8.7 billion in the 2025 to 2026 tax year, about 0.7% of all receipts and 0.3% of national income. Source: Office for Budget Responsibility, November 2025.
The share of UK deaths resulting in an Inheritance Tax charge has moved between 3% and 6% in recent decades and is forecast to reach 6.3% by the 2028 to 2029 tax year. Source: Institute for Fiscal Studies, citing OBR.
The average UK house price was £271,000 in May 2026, £7,000 higher than a year earlier. Source: HM Land Registry, UK House Price Index: UK summary, May 2026, produced by ONS.
In May 2026 the average house price was £164,000 in the North East and £545,000 in London, a gap of £381,000. Source: HM Land Registry, UK House Price Index: UK summary, May 2026, produced by ONS.
The Institute for Fiscal Studies estimates a nil-rate band of £380,000 would be needed to hold the taxed share of deaths at its long-run 4% average. Source: Institute for Fiscal Studies, Reforming inheritance tax, 2023.

What the residence nil-rate band is

The residence nil-rate band is an additional Inheritance Tax allowance that applies on top of the standard £325,000 nil-rate band. It was legislated in the Finance (No. 2) Act 2015 and took effect for deaths on or after 6 April 2017. The relief is available only where a residence, or the proceeds of one, passes to direct descendants such as children, stepchildren, adopted children or grandchildren (gov.uk, Work out and apply the residence nil rate band).

Definitions used in this briefing. The nil-rate band is the standard £325,000 tax-free threshold. The residence nil-rate band is an extra allowance, up to £175,000, tied to a home left to descendants. The taper threshold is the £2 million estate value above which the residence nil-rate band is withdrawn. A chargeable estate is the value remaining after exemptions and reliefs, against which the 40% rate is charged.

Two features shape every statistic that follows. First, the relief is conditional: an estate with no qualifying residence, or one leaving the home to a sibling or a discretionary trust rather than to descendants, does not receive it. Second, the relief tapers away for larger estates, so the households it removes from tax are concentrated in the middle of the distribution rather than at the top.

Scale and take-up

The clearest measure of how the relief is used comes from HMRC's Inheritance Tax liabilities statistics, released on 30 July 2026 and covering deaths up to the 2023 to 2024 tax year. In that year the number of estates using the RNRB was close to the total number of taxpaying estates, which shows how central the relief has become to keeping middle estates below the threshold.

Measure (UK)	2023 to 2024 tax year	Source
Estates using the residence nil-rate band	31,000	HMRC liabilities statistics
Chargeable value sheltered by the RNRB	£7.79 billion	HMRC liabilities statistics
Estates with an Inheritance Tax charge	30,400	HMRC liabilities statistics
Share of UK deaths charged to Inheritance Tax	4.72%	HMRC liabilities statistics
Total Inheritance Tax liabilities created	£7.03 billion	HMRC liabilities statistics
Estates using the spouse or civil partner exemption	5,560	HMRC liabilities statistics
Value passed under the spouse or civil partner exemption	£6.8 billion	HMRC liabilities statistics

Source: HMRC, Inheritance Tax liabilities statistics: commentary, released 30 July 2026. All figures UK-wide, 2023 to 2024 tax year.

The £7.79 billion sheltered by the RNRB in 2023 to 2024 was larger than the £7.03 billion of Inheritance Tax liabilities created in the same year. The relief now removes more chargeable value from the base than the tax itself raises, which places the RNRB among the most significant single reliefs in the system.

Limitation. HMRC's liabilities statistics lag by roughly two tax years because of the delay between a death and the settlement of tax. The 2023 to 2024 figures published on 30 July 2026 are the latest available and are described by HMRC as provisional for the most recent year. They are not directly comparable with the cash receipts series below, which counts money received in a given year rather than liabilities arising from deaths in that year.

Thresholds over time

The RNRB was phased in over four years and then frozen. Its cash value has not changed since April 2020, while the standard nil-rate band has been fixed since April 2009. Both are now frozen until 5 April 2031, the end of the 2030 to 2031 tax year, after the freeze was extended a further year at Budget 2025 on 26 November 2025.

Tax year	Residence nil-rate band	Standard nil-rate band	Maximum tax-free, single person with home to descendants
2017 to 2018	£100,000	£325,000	£425,000
2018 to 2019	£125,000	£325,000	£450,000
2019 to 2020	£150,000	£325,000	£475,000
2020 to 2021	£175,000	£325,000	£500,000
2025 to 2026	£175,000	£325,000	£500,000
2026 to 2027	£175,000	£325,000	£500,000
To 2030 to 2031 (frozen)	£175,000	£325,000	£500,000

Source: gov.uk, Rates and allowances: Inheritance Tax thresholds and interest rates, and gov.uk, Work out and apply the residence nil rate band. Figures as at July 2026, subject to change.

A couple who each leave a qualifying home to descendants can combine two standard bands and two residence bands, giving up to £1,000,000 tax free. That figure has held steady in cash terms since April 2020 while asset prices have risen, which is the mechanism behind the growth in receipts discussed below.

Related reform, for context. From 6 April 2026, agricultural property relief and business property relief give 100% relief on the first £2,500,000 of combined qualifying agricultural and business assets per person, and 50% relief above that. The allowance is transferable between spouses and civil partners, up to £5,000,000 per couple, including where the first death was before 6 April 2026. The £2.5 million figure was announced on 23 December 2025 and replaced an earlier £1,000,000 proposal. Source: gov.uk. These reliefs are separate from the RNRB and are noted here only because they change the wider relief picture.

The home in the residence band

How far £175,000 reaches by region

Because the RNRB is tied to a home, its practical value depends on where that home is. The band is a single national figure, but average house prices differ by more than threefold across England. The table below sets the per-person RNRB of £175,000 and the per-couple property allowance of £350,000 against average house prices in May 2026.

Area	Average house price, May 2026	Annual change	Above per-person RNRB (£175,000)?
North East England	£164,000	+5.9%	No
United Kingdom	£271,000	+£7,000 over 12 months	Yes
England	£292,000	+2.3%	Yes
London	£545,000	-3.7%	Yes, and above the £350,000 couple allowance

Sources: HM Land Registry, UK House Price Index: UK summary, May 2026 for the UK, North East and London figures, and UK House Price Index, England: May 2026 for the England figure, both produced by ONS. Figures are provisional average prices for May 2026, rounded to the nearest £1,000.

In the North East, the average home at £164,000 sits below a single person's £175,000 residence band, so for a typical estate the relief is not fully used against the property. In London, the average home at £545,000 exceeds even a couple's combined £350,000 property allowance by £195,000, so a larger share of the home remains within the taxable estate. The same national relief therefore does different work in different places.

Limitation. Average regional house prices are not the same as the value of a home within a taxable estate, and the RNRB depends on the whole estate value and the taper, not the house alone. HMRC does not publish RNRB take-up by region, so the regional reach shown here is a comparison of two separate datasets, not a measure of relief actually claimed in each region.

Receipts and forecasts

Frozen thresholds and rising asset values have pushed Inheritance Tax receipts to successive records. Cash receipts and the OBR forecast measure the direction of travel, while the taxed share of deaths shows how the base is widening.

Measure (UK)	Figure	Period	Source
Inheritance Tax receipts	£7.5 billion	2023 to 2024	HMRC receipts bulletin
Inheritance Tax receipts (record)	£8.2 billion	2024 to 2025	HMRC receipts bulletin
Inheritance Tax receipts (forecast)	£8.7 billion	2025 to 2026	OBR, November 2025
IHT as a share of all receipts	0.7%	2025 to 2026	OBR, November 2025
Share of UK deaths charged to IHT	4.72%	2023 to 2024	HMRC liabilities statistics
Share of UK deaths charged to IHT (forecast)	6.3%	2028 to 2029	IFS, citing OBR

Sources: HMRC tax receipts bulletin; OBR, Inheritance tax, November 2025; Institute for Fiscal Studies.

The Institute for Fiscal Studies notes that a forecast 6.3% of deaths charged to Inheritance Tax by 2028 to 2029 would be the highest share since the 1970s. The RNRB moderated the rise in the taxed share between 2017 and 2020 as it was phased in, but with the band now frozen that moderating effect has stopped.

Mixed evidence, flagged. The receipts figures and the liabilities figures do not match in any given year because they measure different things: receipts count cash collected, liabilities count tax arising from deaths in a year. The forecast taxed share of 6.3% is an OBR projection reported by the IFS, not an outturn statistic, and depends on assumptions about deaths, asset prices and behaviour that may not hold.

Derived analysis

Original synthesis

The following three measures combine published datasets. Each is a derived estimate, clearly labelled, not an official statistic. The formula, all inputs and the limitations are stated so the working can be checked.

1. RNRB regional headroom Estimate / model

This compares the fixed residence band with average house prices to show how much of a typical home each region's estates can cover before the property enters the taxable base.

Formula. Headroom = per-person RNRB (£175,000) minus average regional house price. A positive figure means the average home sits within a single person's residence band; a negative figure means part of the average home falls outside it.

Area	Average house price (May 2026)	Headroom vs £175,000 (derived)
North East England	£164,000	+£11,000
United Kingdom	£271,000	-£96,000
England	£292,000	-£117,000
London	£545,000	-£370,000

The North East is the only listed area where the average home fits inside a single residence band. In London the average home exceeds the per-person band by £370,000, and exceeds a couple's combined £350,000 property allowance by £195,000.

Inputs: gov.uk RNRB thresholds; HM Land Registry, UK House Price Index: UK summary, May 2026 (UK, North East and London), and England: May 2026 (England). Limitations: average house prices are not estate-level home values; the RNRB applies to whole estates subject to the £2 million taper, not to houses in isolation; regional averages hide wide variation within each region. This is an illustrative model, not a measure of relief claimed.

2. RNRB reliance ratio Derived

This expresses how central the residence band is to the current tax base by relating estates that used it to estates that paid, and value sheltered to tax raised.

Formula. Reliance ratio = estates using the RNRB divided by estates charged to IHT; shelter ratio = value sheltered by the RNRB divided by IHT liabilities created. Both use HMRC figures for the 2023 to 2024 tax year.

Estates using the RNRB (31,000) divided by estates charged to IHT (30,400) = about 1.02. Slightly more estates used the residence band than ended up paying the tax.
Value sheltered by the RNRB (£7.79 billion) divided by IHT liabilities created (£7.03 billion) = about 1.11. The residence band removed roughly 11% more chargeable value than the tax raised.

Inputs: HMRC Inheritance Tax liabilities statistics, released 30 July 2026. Limitations: estates using the RNRB and estates paying IHT are overlapping but not identical groups, so the 1.02 ratio is an indicative comparison rather than a matched figure; sheltered value is measured before the tax rate is applied, so the shelter ratio compares a value base with a tax total, not like with like.

3. Threshold restoration gap Estimate / model

This measures how far the current tax-free threshold has fallen behind the level needed to keep Inheritance Tax at its historical reach, using the IFS restoration figure.

Formula. Restoration gap = IFS estimate of the nil-rate band needed to hold the taxed share at its 4% long-run average (£380,000) minus the actual nil-rate band (£325,000).

Restoration gap = £380,000 minus £325,000 = £55,000, or about 14% below the level the IFS associates with the long-run 4% taxed share.
With both the nil-rate band and the residence band frozen to 5 April 2031, this gap widens each year that prices rise, which is the fiscal-drag effect the OBR builds into its rising receipts forecast.

Inputs: IFS, Reforming inheritance tax, 2023; gov.uk nil-rate band. Limitations: the £380,000 figure is the IFS estimate for the standard nil-rate band, not the residence band, and rests on the IFS view of the 4% long-run average; it is a modelled policy counterfactual, not a government target or an official statistic.

Recommended charts

These specifications describe charts a newsroom or analyst could build from the sources cited. They are described, not embedded.

RNRB take-up versus taxpaying estates, 2017 to 2024. Data: estates using the RNRB and estates charged to IHT, by tax year. Source: HMRC liabilities statistics. Insight: how closely the two lines track, showing the relief's role in defining the tax base. Citation-worthy because it uses a single official series.
Value sheltered by relief, latest year. Data: value sheltered by the RNRB (£7.79 billion), spouse exemption (£6.8 billion), business property relief (£3.85 billion) and agricultural property relief (£2.11 billion), 2023 to 2024. Source: HMRC liabilities statistics. Insight: the RNRB ranks among the largest reliefs by value sheltered.
Average house price versus the residence band, by region. Data: regional average house prices, May 2026, with reference lines at £175,000 and £350,000. Source: HM Land Registry UK House Price Index. Insight: where the average home does and does not fit inside the band.
Inheritance Tax receipts, 2006 to 2026. Data: annual UK receipts, with the £8.2 billion 2024 to 2025 record marked. Source: HMRC receipts bulletin and OBR forecast. Insight: the acceleration under frozen thresholds.
Share of deaths charged to Inheritance Tax, outturn and forecast. Data: taxed share by year, ending at the forecast 6.3% for 2028 to 2029. Source: HMRC liabilities statistics and OBR, via IFS. Insight: the widening reach of the tax.

Methodology

Source selection. Priority was given to primary official statistics: HMRC for Inheritance Tax liabilities, reliefs and receipts; the Office for Budget Responsibility for forecasts; HM Land Registry and ONS for house prices. The Institute for Fiscal Studies is used for analysis that draws on those primary datasets and is labelled as such.

Inclusion and exclusion. A statistic was included only where its exact figure, tax year or date, geography and a working source link could be confirmed against the primary or clearly-attributed source. Figures that could not be verified to source were excluded rather than estimated. No number in the findings or tables is invented.

Handling conflicts. The Inheritance Tax liabilities series (by year of death) and the receipts series (by cash received) differ for the same year; both are reported and the difference is flagged rather than reconciled. Where a figure is an OBR forecast or an IFS projection rather than an outturn, that is stated at the point of use.

Derived figures. The three measures in the synthesis section are calculated from the stated inputs with the formula shown, and each is labelled as an estimate or derived figure. None is presented as an official statistic.

Limitations. HMRC liabilities statistics lag by around two tax years and the most recent year is provisional. HMRC does not publish RNRB take-up by region, so regional analysis compares separate datasets. Average house prices are area averages, not estate-level values.

Last updated. July 2026. Figures are subject to change at future fiscal events and statistical releases.

Source quality ranking

Tier	Source	Used for
Tier 1	HMRC, Inheritance Tax liabilities statistics	RNRB take-up, value sheltered, taxpaying estates, reliefs and exemptions
Tier 1	HMRC tax receipts bulletin	Annual Inheritance Tax receipts
Tier 1	Office for Budget Responsibility	Receipts forecast, share of receipts and national income
Tier 1	HM Land Registry UK House Price Index: UK summary (ONS)	Average house prices, UK and regional
Tier 1	gov.uk RNRB guidance and rates	Band amounts, taper, qualifying conditions
Tier 1	ONS, Consumer price inflation	Inflation context for the frozen band
Tier 1 (academic)	Institute for Fiscal Studies	Threshold analysis, taxed-share forecast, historical context

No Tier 2 (market research or trade) or Tier 3 (journalism or commentary) sources are relied on for any figure in this briefing. All statistics trace to Tier 1 official statistics or to the IFS drawing on them.

For journalists and researchers

Journalist-friendly additions

Most quotable statistics

31,000 UK estates used the residence nil-rate band in 2023 to 2024 (HMRC, released 30 July 2026).
The residence nil-rate band sheltered £7.79 billion of estate value in 2023 to 2024, more than the £7.03 billion of Inheritance Tax liabilities created that year (HMRC).
4.72% of UK deaths resulted in an Inheritance Tax charge in 2023 to 2024 (HMRC).
Inheritance Tax receipts hit a record £8.2 billion in 2024 to 2025 (HMRC receipts bulletin).
The residence nil-rate band has been frozen at £175,000 since April 2020 and stays frozen until April 2031 (gov.uk).
The average home costs £164,000 in the North East but £545,000 in London (HM Land Registry, May 2026).
The taxed share of UK deaths is forecast to reach 6.3% by 2028 to 2029, the highest since the 1970s (IFS, citing OBR).

Data limitations

HMRC liabilities statistics lag by about two tax years; the latest year is provisional.
Liabilities (by year of death) and receipts (by cash received) are different measures and do not match year to year.
RNRB take-up is not published by region; regional analysis here compares separate datasets.
Forecast figures from the OBR and IFS are projections, not outturns.

Recommended dataset fields

For a downloadable dataset on RNRB use, the following fields would support reuse: tax year; estates using RNRB; value sheltered by RNRB; estates charged to IHT; share of deaths charged; IHT liabilities created; IHT cash receipts; standard nil-rate band; residence nil-rate band; taper threshold; average UK house price; average regional house price; source reference; release date; provisional flag.

Press summary

The residence nil-rate band, the extra Inheritance Tax allowance for homes left to children, is now one of the most heavily used reliefs in the UK tax system. HMRC figures released on 30 July 2026 show 31,000 estates used it in the 2023 to 2024 tax year, sheltering £7.79 billion, a larger sum than the £7.03 billion of Inheritance Tax liabilities created that year. The band has been frozen at £175,000 since April 2020 and will stay frozen until April 2031. Because it is tied to a home, its reach varies sharply by region: the average North East home at £164,000 fits inside a single person's band, while the average London home at £545,000 exceeds even a couple's combined £350,000 property allowance. With receipts at a record £8.2 billion in 2024 to 2025 and the taxed share of deaths forecast to reach 6.3% by 2028 to 2029, the frozen band is drawing more estates into charge each year.

Five suggested headlines

The £7.79bn relief: how the residence nil-rate band quietly reshaped Inheritance Tax
31,000 estates, one frozen allowance: the residence nil-rate band in numbers
£175,000 that stretches further in Sunderland than in London
Frozen until 2031: the home allowance losing ground to house prices
More sheltered than raised: the Inheritance Tax relief bigger than the bill

Frequently asked questions

How many estates use the residence nil-rate band?

HMRC statistics released on 30 July 2026 show that 31,000 estates used the residence nil-rate band in the 2023 to 2024 tax year across the UK. In the same year, 30,400 estates were charged to Inheritance Tax, so the number of estates using the relief was slightly higher than the number that ended up paying the tax (Source: HMRC, Inheritance Tax liabilities statistics, released 30 July 2026).

How much does the residence nil-rate band shelter from tax?

The residence nil-rate band sheltered £7.79 billion of chargeable estate value in the 2023 to 2024 tax year across the UK. That was larger than the £7.03 billion of Inheritance Tax liabilities created in respect of deaths in the same year, which makes the band one of the most significant reliefs in the system by value removed from the tax base (Source: HMRC, released 30 July 2026).

How much is the residence nil-rate band in 2026?

The residence nil-rate band is £175,000 per person in the 2026 to 2027 tax year. With a home passing to direct descendants it lifts the tax-free amount to £500,000 for one person, and up to £1,000,000 for a couple who combine two nil-rate bands and two residence bands. It has been £175,000 since the 2020 to 2021 tax year (Source: gov.uk, as at July 2026).

Is the residence nil-rate band frozen?

Yes. The residence nil-rate band has been frozen at £175,000 since April 2020, and the standard nil-rate band at £325,000 since April 2009. Both are frozen until 5 April 2031, the end of the 2030 to 2031 tax year, after the freeze was extended a further year at Budget 2025 on 26 November 2025 (Source: gov.uk, as at July 2026).

When is the residence nil-rate band withdrawn?

The residence nil-rate band is reduced by £1 for every £2 that an estate is worth above the £2 million taper threshold. On that basis the full £175,000 band is removed once an estate reaches £2.35 million, or £2.7 million for a couple using both residence bands. This taper concentrates the relief on middle estates rather than the largest ones (Source: gov.uk).

Why are Inheritance Tax receipts rising?

Inheritance Tax receipts reached a record £8.2 billion in the 2024 to 2025 tax year, up from £7.5 billion the year before. HMRC attributes the continued growth to rising asset values combined with decisions to maintain the tax-free thresholds, so more estates exceed frozen bands as prices rise (Source: HMRC tax receipts bulletin).

What share of deaths pay Inheritance Tax?

In the 2023 to 2024 tax year, 4.72% of UK deaths resulted in an Inheritance Tax charge. The share has moved between about 3% and 6% in recent decades and is forecast to rise to 6.3% by the 2028 to 2029 tax year, which the Institute for Fiscal Studies notes would be the highest since the 1970s (Source: HMRC; IFS, citing OBR).

Does the residence nil-rate band vary by region?

The band is a single national figure of £175,000, but because it is tied to a home its practical reach varies with local house prices. In May 2026 the average home cost £164,000 in the North East, within a single person's band, but £545,000 in London, above even a couple's combined £350,000 property allowance. HMRC does not publish take-up by region (Source: HM Land Registry UK House Price Index, May 2026).

How does the residence nil-rate band compare with other reliefs?

In the 2023 to 2024 tax year the residence nil-rate band sheltered £7.79 billion, the spouse and civil partner exemption passed £6.8 billion across 5,560 estates, business property relief sheltered £3.85 billion across 4,060 estates, and agricultural property relief £2.11 billion across 2,140 estates. The residence band was the largest of these by value sheltered (Source: HMRC, released 30 July 2026).

Who qualifies for the residence nil-rate band?

The relief applies where a residence, or the proceeds of one, passes to direct descendants such as children, stepchildren, adopted children or grandchildren. An estate with no qualifying home, or one where the home passes to someone other than a descendant, does not receive it, and the band tapers away above £2 million. This is general information, not advice on any individual estate (Source: gov.uk, Work out and apply the residence nil rate band).

The Residence Nil-Rate Band in Practice