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RNRB = additional £175,000 IHT allowance when passing home to children/grandchildren (on top of £325,000 standard). Total per person: £500,000. Couples: £1,000,000 combined. Requirements: owned home, passed to direct descendants (children, grandchildren including adopted/step/foster), estate under £2m (tapers above, lost at £2.35m). Claim via IHT435. Fixed until 5 April 2030. Transferable between spouses.
The Residence Nil-Rate Band (RNRB) was introduced in April 2017 to help families pass on the family home without Inheritance Tax.
Key Facts About RNRB
- • £175,000 additional allowance (2026/27, fixed until 5 April 2030)
- • In addition to the standard £325,000 Nil Rate Band, which is fixed until 5 April 2031
- • Total per person: £500,000 (£325K + £175K)
- • Couples: £1,000,000 combined (£650K + £350K)
- • Only applies when passing home to children/grandchildren
- • Tapers down for estates over £2 million
To qualify for the full Residence Nil-Rate Band, ALL these conditions must apply:
The deceased must have owned a home (or share of a home) at the time of death. This includes:
Learn more about what happens to property after death.
"Direct descendants" means:
Does NOT include:
If the estate exceeds £2 million, the RNRB is gradually reduced (see taper section below).
| Situation | RNRB Amount |
|---|---|
| Home value £175K or more | £175,000 (full RNRB) |
| Home value less than £175K | Home value only (e.g., £120K home = £120K RNRB) |
| Married couple (both deceased) | Up to £350,000 combined |
| Estate over £2 million | Reduced (see taper below) |
If the estate exceeds £2 million, the RNRB is reduced by £1 for every £2 the estate exceeds the threshold.
If your spouse or civil partner died before you, you may be able to claim their unused RNRB - even if they died before RNRB was introduced in 2017.
You can claim unused RNRB if:
Amount you can claim:
If you downsized or sold your home after 8 July 2015, you may still claim RNRB through "downsizing relief" - even if you don't own a property when you die.
You can claim if:
RNRB works alongside the standard Nil Rate Band (£325,000) to increase your total tax-free allowance:
| Allowance | Single Person | Married Couple |
|---|---|---|
| Standard Nil Rate Band | £325,000 | £650,000 |
| Residence Nil Rate Band | £175,000 | £350,000 |
| TOTAL TAX-FREE | £500,000 | £1,000,000 |
RNRB is claimed through Inheritance Tax forms when applying for probate.
The RNRB only applies where the residence is inherited by a direct descendant. What determines whether it is:
The taper works off the net estate at death, so anything that reduces that figure — lifetime gifts made more than seven years earlier, exempt gifts to charity, or a policy written in trust so the proceeds fall outside the estate — affects how much RNRB survives the taper. The annual gift exemption is £3,000.
A downsizing addition is claimed by the personal representatives, and the relevant records are the value of the former home, the date it was disposed of (it must be after 8 July 2015), and what passed to direct descendants instead.
RNRB works alongside other Inheritance Tax reliefs:
No, but you don't lose it. Your unused RNRB transfers to your spouse. When your spouse dies and leaves the home to your children, they can claim BOTH RNRB allowances (up to £350,000).
Yes, RNRB applies to your share of the property if it passes to your children. If your share is worth less than £175K, your RNRB is limited to that share value.
Yes, if you leave the property to your grandchildren (your deceased child's children). The property can pass "down" a generation and still qualify.
The RNRB applies to one residence only. Where the estate includes more than one dwelling-house the deceased lived in, section 8H(4) of the Inheritance Tax Act 1984 requires the personal representatives to nominate one (and only one) of them. There is no separate deadline for the nomination itself, but a claim for a transferred allowance or a downsizing addition must be made within 2 years of the end of the month in which the death occurred (section 8L).
It depends on the deceased's tax status. For deaths on or after 6 April 2025, HMRC's manual IHTM46032 says that where the deceased was a long-term UK resident it does not matter where the residence is located, so a home abroad can qualify. Where they were not a long-term UK resident, the residence must be situated in the UK. For earlier deaths the same test ran on UK domicile rather than long-term residence.
Quick Summary
- ✓ £175,000 extra allowance when passing home to children
- ✓ £500,000 total per person (£325K + £175K)
- ✓ £1 million for couples (both allowances combined)
- ✓ Must pass to children/grandchildren (not siblings)
- ✓ Tapers for estates over £2m
- ✓ Transferable from late spouse (even if died pre-2017)
- ✓ Downsizing relief available if sold home after 2015
- ✓ Claim via IHT435 form when applying for probate
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