On every person's death, their estate has an Inheritance Tax (IHT) free allowance which is determined by the Government each year in their Budget. This allowance is known as the Nil Rate Band (NRB) and for the tax year 2011/12 amounts to £325,000, the  level at which is now fixed, subject to future Budgets, until 2013/14 (view Nil Rate Bands for previous years).

If you are an executor currently dealing with an estate administration or alternatively wish to consider what is the likely impact of IHT on your own estate, this calculator will help you to estimate the amount of IHT payable on the estate. It should only be used to illustrate an approximate tax liability based on the information you provide and we would always recommend professional advice be taken.

Please note: if the person's estate has been (or will be) left entirely to their spouse or civil partner, or indeed to charity, then the estate is likely to be wholly free of IHT and it is unnecessary to use this calculator. For deaths on or after 6 April 2012 the rate of IHT is 36% (reduced from 40%) for estates where 10% or more of the net estate is left to charity.

Value of house Enter the value of your share in any house you own
Value of all other assets Enter the value of all other assets, including bank accounts, shares and investments
Gross estate
Less
Mortgage Enter the value of any outstanding mortgage
Value of all other debts Enter the value of other debts, including credit cards and other outstanding loans
Total liabilities
Net estate
Value of transferable Nil Rate Band
(use our transferable Nil Rate Band calculator) 		Enter the estimated value of transferable Nil Rate Band if appropriate (taken from the transferable Nil Rate Band calculator)
Nil Rate Band
Less
Total Nil Rate Band
Add
Lifetime gifts Enter the value of any lifetime gifts made in the last seven years (after any annual allowances have been deducted)
Estimated taxable estate
Estimate of Inheritance Tax

 

notes

This calculator may not be appropriate if affairs are complicated, for example, the person for whom you are doing the calculation was:

  • a beneficiary of a trust
  • made large life-time gifts
  • was domiciled outside England and Wales

or where:

  • the Will leaves legacies over the value of the NRB and the residue goes to a spouse or charity or the residue is shared between a spouse or charity and other beneficiaries.

If you are married or in a civil partnership and wish to leave everything to your spouse or civil partner, then you may want to consider the likely impact of IHT on the survivor's death. To do this, simply use in the calculator the total value of the assets and liabilities owned by both of you and put £325,000 in the 'Value of transferable Nil Rate Band' box. Alternatively, if you are a widow, widower or surviving civil partner, or where you are an executor dealing with an estate where such a person has died after 9 October 2007, it may be possible for the estate to claim for any unused IHT NRB from the estate of the first spouse or civil to die so that it can be added to their own NRB. To see how this might work, you should go to our transferable Nil Rate Band calculator.

For further information or to talk to someone about a specific matter, please contact a team member in the office nearest you:

Rachel Brooks, partner and head of Private Client Services group in our Portsmouth office, on 023 9228 2714 or at rachel.brooks@bllaw.co.uk.

James Antoniou, partner in our Oxford office, on 01865 254286 or at james.antoniou@bllaw.co.uk.

Fiona Fox, solicitor in our Southampton and Portsmouth offices, on 023 8085 7282 / 023 9228 2748 or at fiona.fox@bllaw.co.uk.

Douglas Smith, partner in our London office, on 020 7814 5438 or at douglas.smith@bllaw.co.uk.

Alternatively, email our general enquiries helpdesk on privateclientinfo@bllaw.co.uk.