Inheritance Tax Calculator (UK)
Enter the value of an estate to see whether Inheritance Tax is due and how much the beneficiaries would keep.
| Value of the estate | £700,000 |
|---|---|
| Left to charity (exempt) | −£0 |
| Nil-rate band | −£325,000 |
| Residence nil-rate band | −£175,000 |
| Taxable estate | £200,000 |
| Inheritance Tax at 40% | £80,000 |
| Left for the beneficiaries | £620,000 |
This is an estimate. It does not cover gifts made in the last seven years, trusts, business or agricultural relief, or foreign property, which can all change the result. For a large or complex estate, get advice from a solicitor or tax adviser.
How Inheritance Tax works
Inheritance Tax is charged at 40% on the part of an estate above the tax-free allowances. In 2026/27 these are:
| Allowance | Amount | Notes |
|---|---|---|
| Nil-rate band | £325,000 | Applies to every estate. Fixed until 5 April 2031. |
| Residence nil-rate band | £175,000 | Extra allowance when the home goes to children or grandchildren. Fixed until 5 April 2030. Reduces by £1 for every £2 the estate is over £2,000,000. |
| Spouse or civil partner | Unlimited | Anything left to them is exempt, and their unused allowances can pass to the survivor. |
| Charity | Unlimited | Exempt. If 10% or more of the estate goes to charity, the rate on the rest drops to 36%. |
Example: a £700,000 estate including a £400,000 home left to children has allowances of £500,000 (£325,000 + £175,000), so the taxable part is £200,000 and the tax is £80,000.
Couples
When the first partner dies and leaves everything to the survivor, no tax is due, and any unused nil-rate band and residence nil-rate band is added to the survivor’s. That can give up to £1,000,000 of allowances on the second death.
Gifts and other rules this does not cover
- Gifts made in the seven years before death can be added back to the estate.
- Regular gifts from income, and gifts up to £3,000 a year, can be exempt.
- The Government has announced that most unused pension funds will count towards the estate from 6 April 2027.
- Relief for business and farmland has its own rules and changes.
This calculator is an estimate for planning. For a larger or more complex estate, speak to a solicitor or tax adviser. Inheritance Tax is normally paid within six months of the end of the month of death.
Sources: GOV.UK: Inheritance Tax, GOV.UK: Inheritance Tax thresholds and interest rates. Figures last checked on 8 October 2026.
Frequently asked questions
What is the Inheritance Tax threshold in 2026/27?
The standard nil-rate band is £325,000. With the residence nil-rate band of £175,000 for homes left to children or grandchildren, a single person can pass on up to £500,000 tax-free, and a couple up to £1,000,000.
What is the Inheritance Tax rate?
40% on the value above the allowances, or 36% if at least 10% of the estate is left to charity.
Do I pay Inheritance Tax on gifts to my spouse?
No. Anything left to a spouse or civil partner who lives in the UK is exempt.
Who pays Inheritance Tax?
It is paid from the estate by the executors, usually before the beneficiaries receive their inheritance.
Are pensions included in Inheritance Tax?
Not at the moment, but the Government has announced that most unused pension funds will be included from 6 April 2027.
More from UK Answers
Figures are for the 2026/27 tax year from official sources and are estimates for guidance only, not financial or legal advice. Printed from ukanswers.co.uk.