Residence nil rate band ― main provisions

Produced by a Tolley Trusts and Inheritance Tax expert

Trusts and Inheritance Tax

Guidance

What is the residence nil rate band (RNRB)?

The RNRB is an addition to the basic nil rate band (NRB), which further reduces the inheritance tax payable on death. It differs from the basic NRB in that it is applied only to the death estate and not to lifetime gifts within seven years of death.

Like the NRB, it is also available to an individual regardless of domicile.

The enhanced allowance is dependent on:

•
the value of residential property in the estate, and
•
the inheritance of lineal descendants

The RNRB was introduced in Finance Act 2015, with further refinements added by Finance Act 2016. It took effect from 6 April 2017. The detailed legislation is to be found in amendments to IHTA 1984. Much of the commentary on the provisions has focused on the complexity of the legislation

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