Nil-Rate Band Explained
The nil-rate band is the IHT-free threshold on a UK estate. For 2025/26 it is £325,000 per person. Anything above this is taxed at 40%, subject to reliefs and exemptions.
Married couples and civil partners can combine their nil-rate bands. If the first spouse to die does not use their full allowance, the unused portion transfers to the surviving spouse, potentially doubling the threshold to £650,000.