Main residence nil rate tax band

In his 2015 summer Budget, the Chancellor announced an additional inheritance tax allowance when a residence passes, on death, to direct descendants.  The additional allowance starts at an extra £100,000 after 6 April 2017 and increases to £175,000 from April 2020.  It has been publicised that, from 2020, this will enable families to leave estates of £1m before inheritance tax is due.

However, the Government has not been so keen to publicise that the new provisions 
will only favour a limited number of families; these include families with children, step-children and fostered children, and in limited circumstances those where downsizing is of particular concern.  
Furthermore, for those with over £2 million of assets there will be a sting in the tail, as the allowance will be tapered away.

The media has implied that ‘thousands will miss out unless they make changes and take advice’, both when they are planning for the future - for example, making their will - and again when they are dealing with an estate after a death in the family.

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