Couples can now leave up to £1,000,000 inheritance tax free to their children.

The relief started in April 2017 with £100,000 residence nil rate band (RNRB) per person and has increased by £25,000 every 6th April until it has reached £175,000, the maximum level. This RNRB benefits people leaving their residence down to their children or grandchildren. This is in addition to the traditional nil rate band of £325,000.

For a couple, when passing assets down to their children, they can benefit from 2 x traditional nil rate band (NRB) totalling £650,000 and 2 x residence nil rate (RNRB) band totalling £350,000, which equates to £1 million.

Clients often get confused with the NRB and RNRB, how and where they can be applied. In some cases the RNRB could apply to a second property which is no longer the main residence, it could be that whole or part of the RNRB may be transferred to a surviving spouse where one died before 6 April 2017, when the scheme was introduced. Also, for estates worth over £2million, the RNRB can be less effective.

How Barnes Harrild & Dyer Solicitors can help

Our Wills, Probate and Estate Planning department at Barnes Harrild & Dyer Solicitors at our Central London and Croydon offices, are experts in advising and assisting clients to arrange their estate planning via trusts and wills. Sensible planning can make all the difference in preserving your estate for your loved ones.

This area is generally quite complex and, as time is not of the essence with visa, conveyancing or court imposed deadlines, wills, trusts and estate planning often gets pushed over until it is sometimes too late to put in place the best estate plan during your lifetime.