Transferring the Nil Rate Band Between Spouses: Complete Guide

How the Transferable NRB Works

Introduced in October 2007, the transferable nil-rate band allows a surviving spouse or civil partner to claim the unused proportion of their late spouse's NRB on their own death. It works as follows:

1. On the first death, the executors note what proportion of the deceased's NRB was unused (0% to 100%)
2. That unused proportion is "banked" and can be claimed by the surviving spouse's estate on the second death
3. The claim increases the second estate's effective NRB by the transferred percentage

Crucially, the transfer is expressed as a percentage, not a fixed amount. It is applied to the NRB at the time of the second death. Since the NRB is currently frozen at £325,000 until 2030, a 100% transfer is worth £325,000 in additional threshold.

Example: Full NRB Transfer

Example: Partial NRB Transfer

The Residence Nil-Rate Band (RNRB) Is Also Transferable

Since 2017, the RNRB (currently £175,000) is also transferable between spouses on the same basis. If the first spouse dies without using their RNRB (for example, because they left the home to the surviving spouse rather than to children, or because they died before the RNRB was introduced), the unused RNRB transfers to the second estate.

Combined with the transferred NRB, a couple can potentially shelter £1,000,000 from IHT on the second death:

• Surviving spouse's own NRB: £325,000
• Transferred NRB from first spouse: £325,000
• Surviving spouse's own RNRB: £175,000
• Transferred RNRB from first spouse: £175,000
• Total: £1,000,000

The RNRB conditions must be met — in particular, a qualifying residential property must pass to direct descendants (children, grandchildren, etc.). See our full guide to the RNRB for the eligibility requirements, downsizing addition, and taper for estates above £2m.

Claiming the Transferred NRB: The Process

The transferred NRB is not automatic — it must be claimed by the executors of the second estate. The claim is made on form IHT402 ("Claim to Transfer Unused Nil Rate Band"), submitted with the IHT400 when applying for probate.

Executors will need to produce evidence of:

• The first spouse's death certificate
• The first spouse's will (or intestacy evidence)
• The first spouse's IHT form (IHT400 or IHT205 from the first death), or evidence of what the estate was worth and how it was distributed

For deaths that occurred many decades ago, this can be challenging. HMRC will accept reasonable alternative evidence if original documents have been lost.

What If the First Spouse Died Before 2007?

The transferable NRB was introduced in October 2007, but it applies retrospectively. If the first spouse died before 2007 — even decades ago — the unused NRB from their estate can still be claimed by the second estate. The transfer percentage is calculated based on what portion was unused at the time of the first death, applied to the NRB at the time of the second death.

This is particularly valuable for widows and widowers who lost their spouse many years ago and may not have realised they can claim the transferred NRB.

Will Structure to Maximise the Transfer

To make the most of the transferable NRB, wills should be structured carefully. The key point is that the maximum transfer (100%) occurs when the first spouse leaves everything to the survivor using the spouse exemption — their NRB is completely unused.

However, this is not always optimal. If the second estate will be very large, it may sometimes be preferable to use some of the first spouse's NRB on assets passing to children at the first death — rather than accumulating the full estate in the survivor's hands. A tax specialist can model the most efficient structure for your specific circumstances.

What to avoid is a will that accidentally uses the NRB inefficiently — for example, by making specific bequests to non-spouse beneficiaries that consume the NRB without thought. If you or your spouse has not updated your will recently, check that it is still optimal given current thresholds and the size of the estate.

Related Guides

• Residence Nil Rate Band: Eligibility, Downsizing, and the Taper
• Gifting Strategy 2025/26
• Life Insurance in Trust
• IHT on Jointly Owned Property
• IHT Thresholds Frozen Until 2030
• Charitable Legacy to Reduce IHT to 36%
• How to Write a Will UK 2026
• IHT Planning Checklist 2025/26
• Complete UK Inheritance Tax Guide 2026/27
• Get Started With Farra