Inheritance Tax calculator

Enter what the estate is worth, the value of a home that goes to children or grandchildren, any unused bands passed on from a late husband, wife or civil partner, and any gifts to charity in the will. The calculator estimates the Inheritance Tax due and sets out each step.

Inheritance Tax due

£40,000.00

An estimate. The executors and HMRC work out the real figure.

Your details

Estate value

Everything you own, after debts and funeral costs

Home value

Net of any mortgage on it

Is the home going to a child or grandchild? Yes No

Left to charity

Gifts to charity in the will

Unused nil-rate band transferred % Percent, 0 to 100

Unused residence band transferred % Percent, 0 to 100

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How the Inheritance Tax is worked out

	Amount
Estate value	£600,000.00
Gifts to charity	£0.00
Nil-rate band available	£325,000.00
Residence nil-rate band used	£175,000.00
Value above the allowances	£100,000.00
Inheritance Tax at 40%	£40,000.00

How this was worked out

1. Estate value: £600,000.00
2. Nil-rate band: £325,000.00 plus 0% transferred = £325,000.00
3. Residence nil-rate band: £175,000.00 plus 0% transferred = £175,000.00
4. Residence band after the taper: £175,000.00 − £0.00 = £175,000.00; the home is worth £400,000.00, so £175,000.00 of the band is used
5. Allowances together: £325,000.00 + £175,000.00 = £500,000.00
6. Value above the allowances: £600,000.00 − £500,000.00 = £100,000.00
7. Inheritance Tax at 40%: £100,000.00 × 40% = £40,000.00

Was this right and useful?

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What the calculator assumes

• The person died in the 2026/27 tax year and was based in the UK.
• The estate value is everything the person owned minus their debts. It leaves out anything going to a husband, wife or civil partner, because no Inheritance Tax is due on that.
• The home value is the person's share of the home at market value, minus any mortgage on it.
• No gifts were made in the seven years before the death, and no Business Relief, Agricultural Relief or trust is involved.
• The unused bands passed on from a late husband, wife or civil partner are entered as a percentage, up to 100%.

The two tax-free bands

Every estate has a nil rate band. Inheritance Tax is only charged on the part of the estate above it.

The residence nil rate band is extra, and it only applies when a home goes to direct descendants. Those are children, including adopted, foster and stepchildren, and grandchildren. The home must be one the person lived in at some point, so a buy to let property does not count. The band can be no bigger than the value of the share of the home they inherit. Once it is worked out, it comes off the value of the whole estate, including the other assets.

For large estates the residence band gets smaller, and above a certain value it goes altogether. The working shows the limit and how much of the band is left.

Bands passed on by a late husband, wife or civil partner

When someone dies and does not use all of their bands, the unused share can pass to their husband, wife or civil partner's estate. GOV.UK says the residence band passes as a percentage of the band, and the calculator treats the nil rate band in the same way. If the first partner used a quarter of their residence band, 75% of it passes on, and it is applied to the band in force when the second partner dies. The two bands are separate, so the percentages can differ.

The residence band passed on cannot be more than 100%, even if someone had more than one late husband, wife or civil partner. Couples who were not married or in a civil partnership cannot pass unused bands to each other.

Gifts to charity

Anything left to a charity in the will is free of Inheritance Tax. If a large enough share of the estate goes to charity, the rest of the estate pays a reduced rate. The calculator checks whether the gifts you enter meet the test, and the working shows the rate it used.

The executor pays the tax to HMRC from the estate's money. People who inherit do not normally pay Inheritance Tax on what they receive.

What it leaves out

• Gifts made in the seven years before the death, and the taper relief that can lower the tax on them.
• Gifts the person gave away but still benefited from, such as a home they carried on living in.
• Extra residence band for someone who sold their home or moved to a cheaper one.
• Business Relief, Agricultural Relief and assets held in trust.
• The rules for people based outside the UK.
• Estates where the charity test applies separately to different parts of the estate. The calculator treats the estate as one part.

The rates and thresholds page collects the main tax figures for the year in one place. If you inherit a house and let it out, the rent is income, and the Income Tax rates page shows how it is taxed. If you pay off a mortgage with money you inherit, the mortgage overpayment calculator shows the interest it saves. For money you keep in savings, the compound interest calculator shows how it grows.

Official guidance

• How Inheritance Tax works on GOV.UK
• Check if an estate qualifies for the residence nil rate band on GOV.UK
• Transferring unused residence nil rate band on GOV.UK
• Inheritance Tax reduced rate calculator on GOV.UK

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