What the residence nil-rate band is
Who this guide is for: For estates that may leave a home to children or grandchildren — read alongside Inheritance Tax Explained for the wider estate picture.
The residence nil-rate band (RNRB) is an additional Inheritance Tax threshold. It can apply when someone dies leaving a qualifying interest in a home to one or more direct descendants.
It does not mean the home itself is exempt. It increases the amount of estate that can pass at 0% before the standard rate applies, provided the conditions are met.
How it differs from the ordinary nil-rate band
| Topic | Nil-rate band | Residence nil-rate band |
|---|---|---|
| Current maximum (frozen window) | £325,000 | £175,000 |
| Home to direct descendants needed? | No | Yes (qualifying path) |
| Applies to lifetime gifts? | Can be used against gifts | No — death estate only |
| Taper for large estates? | No equivalent taper | Yes above £2 million |
Because RNRB does not shelter lifetime gifts, large gifts in the seven years before death can use up the basic nil-rate band while RNRB still remains available against the death estate — if the home conditions are met. See Inheritance Tax on Gifts.
Qualifying home and direct descendants
The estate needs a qualifying residential interest — typically a home the person lived in. The allowance available for the estate is the lower of the maximum RNRB (after taper and any transferred amount) and the value of the home interest that passes to direct descendants. Unused RNRB cannot be set against other assets in that same estate, though unused RNRB may transfer to a spouse or civil partner.
Direct descendants include children, grandchildren and other lineal descendants; spouses or civil partners of those descendants (including surviving spouses or civil partners); step-children; adopted children; foster children; and children for whom the deceased was a guardian or special guardian while the child was under 18.
Nephews, nieces, siblings and other relatives outside that list do not count. If a home is left partly to descendants and partly to others, only the descendant share supports RNRB.
The home does not have to be left by a specific gift in the will — it can pass in the residue. Personal representatives can sell the home during administration and still preserve RNRB if the proceeds go to the qualifying descendants under the will or intestacy rules.
Estate-value taper
When the estate measure used for taper is worth more than £2,000,000, the residence nil-rate band reduces by £1 for every £2 of excess. For that measurement, take assets less debts and liabilities. Do not deduct spouse exemption or reliefs such as Agricultural or Business Relief when working out the taper base.
At a high enough estate value the RNRB can taper to nil even if a home is left to children. Transferable unused RNRB from a first death can also be reduced by taper on that first estate.
Transfer between spouses and civil partners
Unused RNRB is transferred as an unused percentage, not a fixed cash amount. On the second death, that percentage is applied to the RNRB maximum then in force and added to the survivor's own allowance — still subject to home-value caps and taper on the survivor's estate.
Because the ordinary nil-rate band and the residence nil-rate band are separate, the transferable unused percentage for RNRB can differ from the transferable unused percentage for the ordinary nil-rate band. Official transfer guidance covers claims and forms. Sorvuna asks you to enter each unused percentage rather than reconstructing the first estate.
Downsizing and when RNRB may not be available
Special rules can preserve some RNRB where a person sold, gave away or downsized a home on or after 8 July 2015 and other conditions are met ("downsizing addition"). Those rules are detailed. The Sorvuna calculator does not model downsizing addition — confirm eligibility on GOV.UK or with a professional adviser.
RNRB may also be unavailable or reduced when:
- no qualifying home interest passes to direct descendants
- the home value to descendants is low (capping the allowance)
- taper removes the allowance for a large estate
- trust or timing conditions mean descendants do not inherit at death
Worked examples
RNRB available and tax still due
Illustrative death date 2026-06-15. Computed with the Sorvuna Inheritance Tax engine.
| Main home to direct descendants | £400,000.00 |
|---|---|
| Other assets | £300,000.00 |
| Gross estate | £700,000.00 |
| Nil-rate band used | £325,000.00 |
| Residence nil-rate band used | £175,000.00 |
| Taxable estate | £200,000.00 |
| Estimated Inheritance Tax at 40% (key figure) | £80,000.00 |
Assumes no debts, no spouse exemption, no transferred allowances and no lifetime gifts.
RNRB taper above £2 million
Estate measure £2,200,000 — £200,000 above the taper threshold.
| Main home | £500,000.00 |
|---|---|
| Other assets | £1,700,000.00 |
| Taper estate measure | £2,200,000.00 |
| Excess above £2 million | £200,000.00 |
| Taper reduction (£1 per £2) | £100,000.00 |
| RNRB after taper | £75,000.00 |
| Estimated Inheritance Tax (key figure) | £720,000.00 |
Maximum RNRB before taper is £175,000. After a £100,000 taper cut, £75,000 remains available in this example.
Assert whether the home passes to children or grandchildren and estimate RNRB and taper Use the Inheritance Tax Calculator
Relationship to Sorvuna's calculator
The Inheritance Tax Calculator lets you assert that the main home passes to direct descendants, enter unused RNRB transfer percentages, and see taper for larger estates. It does not decide eligibility for you, and it does not model downsizing addition, trusts or mixed descendant / non-descendant splits beyond the simple assertion path.
For the wider estate rules see Inheritance Tax Explained, or start from the Inheritance Tax hub.