Inheritance Tax UK 2026 — Complete Guide: Thresholds, Rates and How to Reduce IHT
Complete guide to inheritance tax UK 2026 — thresholds, rates, exempt gifts, and 10 legal ways to reduce your family's IHT bill.
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Chandraketu Tripathi
Finance Editor, Kaeltripton
Published3 Apr 2026
Last reviewed20 Apr 2026
✓ Fact-checked
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UK Finance Guide — 2026
This comprehensive guide covers everything you need to know about inheritance tax uk 2026 in the UK for 2026.
IHT Thresholds and Rates
Inheritance tax is charged at 40% on the value of your estate above the nil-rate band. The main thresholds for 2026/27 are:
Allowance
Amount
Notes
Nil-rate band (NRB)
£325,000
Standard threshold — no IHT below this
Residence nil-rate band (RNRB)
£175,000
For passing main home to direct descendants
Combined (individual)
£500,000
NRB + RNRB combined
Combined (married couple)
£1,000,000
Both NRBs and RNRBs transferred to survivor
IHT rate above threshold
40%
On value above nil-rate bands
What Is Included in Your Estate?
Your estate for IHT purposes includes everything you own at death:
Gifts and the 7-Year Rule
Gifts made during your lifetime can reduce your estate — but most gifts only become fully exempt if you survive 7 years after making them. Taper relief reduces the IHT on gifts made 3–7 years before death.
Years Before Death
IHT Rate on Gift
0–3 years
40%
3–4 years
32%
4–5 years
24%
5–6 years
16%
6–7 years
8%
7+ years
0% — fully exempt
Annual Exemptions and Allowances
These gifts are always exempt from IHT regardless of the 7-year rule:
✅ Key actions to take now
Read the full breakdown above for your specific situation
Use the comparison tables to find the best option for you
Check the related articles below for more detailed guidance
Bookmark this page — figures update as rates and rules change in 2026
Bottom line: Use this guide to understand your options and take action. The UK financial landscape in 2026 has changed significantly — staying informed and making proactive decisions is the difference between making the most of your money and leaving value on the table.
The content on Kaeltripton.com is for informational and educational purposes only and does not constitute financial, investment, tax, legal or regulatory advice. Kaeltripton.com is not authorised or regulated by the Financial Conduct Authority (FCA) and is not a financial adviser, mortgage broker, insurance intermediary or investment firm. Nothing on this site should be construed as a personal recommendation. Rates, figures and product details are indicative only, subject to change without notice, and should always be verified directly with the relevant provider, HMRC, the FCA register, the Bank of England, Ofgem or other appropriate authority before any financial decision is made. Past performance is not a reliable indicator of future results. If you require regulated financial advice, please consult a qualified adviser authorised by the FCA.
CT
Chandraketu Tripathi
Finance Editor · Kaeltripton.com
Chandraketu (CK) Tripathi, founder and lead editor of Kael Tripton. 22 years in finance and marketing across 23 markets. Writes on UK personal finance, tax, mortgages, insurance, energy, and investing. Sources: HMRC, FCA, Ofgem, BoE, ONS.
