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Will your family still benefit from the new Residential Nil Rate Band?

From 6 April this year the new Residential Nil Rate Band (RNRB) will allow an additional £100,000 of property to be passed, by your Will, to direct descendants alongside the current individual Inheritance Tax free allowance of £325,000.

This raises the value of property that a couple can pass on death without incurring an Inheritance Tax bill to £850,000 and is set to incrementally rise to £1,000,000 by 2020.

As Inheritance Tax is charged at 40%, this represents significant savings to estates that qualify.

To qualify for the RNRB, individuals will need to be gifting their main residence directly to descendants; children, step children, adopted children or grandchildren.

It is estimated that a significant number of wealthier families will lose out on the benefit where they have made arrangements to pass their assets into discretionary trusts unless they take action to review these arrangements.

It is a good idea to review any tax planning and trust arrangements that you have in place to ensure that the benefit is not lost. There are also possibilities for families to amend arrangements by a deed of variation to capture the benefit for up to two years post death.

If you have concerns about Inheritance Tax and the gifts you leave behind, please do not hesitate to Call Us 0800 042 0700, or email us on enquiries@lindermyers.co.uk.

Find out more about our Trusts & Estates department
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