From 6th April 2017, a new inheritance tax relief was introduced which will save families money in respect of disposal of their property – the Residence Nil Rate Band (RNRB).

The RNRB will apply where a property is left to lineal descendants on death. The disposal of the property can either be by way of a Will or under the intestacy rules and the property can be left as a stand-alone gift or can be included as part of a residuary gift.

As of April 2017, the value of the relief will be £100,000. This amount will increase by £25,000 per year up until 2020 when it will reach £175,000. After this, any increases in value will be in accordance with inflation. It should be noted that if an estate is worth over £2million, the relief will be reduced proportionately.

This new allowance is on top of the normal inheritance tax allowance of £325,000 per person so by 2020 a married couple may have up to £1million of allowance before tax becomes due.