IHT nil rate band freeze extended to 2031

The Spring Statement 2026 confirmed that the inheritance tax nil rate band (NRB) will remain frozen at £325,000 until April 2031 — one year beyond the period announced in the Autumn Budget 2025. The residence nil rate band (RNRB) is similarly frozen at £175,000 for the same period.

For qualifying estates where the deceased owned a residential property passed to direct descendants, the combined effective threshold remains £500,000 per individual, or £1,000,000 for married couples and civil partners using the transferable allowances. These figures have not changed, but the freeze means they will remain unchanged until 2031 — 22 years since the NRB was last set.

The fiscal drag effect is compounding. With property values continuing to rise in many regions, HMRC estimates the proportion of estates paying IHT will increase from approximately 4% in 2023/24 to around 6–7% by 2029/30. IHT receipts in the first seven months of 2025/26 were already £200 million ahead of the same period a year earlier, and receipts are forecast to exceed £14 billion by 2029/30.

For solicitors advising on estate planning, the extended freeze makes it more important than ever to confirm RNRB eligibility carefully — particularly for estates involving trusts, step-children, or properties that were not the deceased's main residence at the point of death. The RNRB taper also remains in place for estates above £2,000,000, reducing the RNRB by £1 for every £2 over the threshold.