This is a summary of the latest rates and bands for inheritance tax
|
| 2020/2021 | 2019/2020 |
| Nil-rate band * | £325,000 | £325,000 |
| Residential nil-rate band * | £175,000 ** | £150,000 ** |
| Rate of tax on excess | 40% | 40% |
| Rate if at least 10% of net assets left to charity | 36% | 36% |
| Lifetime transfers to and from certain trusts | 20% | 20% |
| Overseas domiciled spouse/civil partner exception | £325,000 | £325,000 |
| *Up to 100% of the unused proportion of a deceased spouse’s/civil partner’s nil-rate band can be claimed on the survivor’s death | ||
| **Subject to 50% taper for estates above £2,000,000 | ||
| Annual exempt gifts of: £3,000 per donor £250 per donee | ||
| Tax charge on gifts within 7 years of death | |||||
| Years before death | 0-3 | 3-4 | 4-5 | 5-6 | 6-7 |
| % of death tax charge | 100 | 80 | 60 | 40 | 20 |