UK Inheritance Tax Calculator 2025/26 — Fane Financial Services

Your Situation

Are you a homeowner? Enables property equity inputs and determines eligibility for the Residence Nil-Rate Band (RNRB)	NoYes YES
Leaving your estate (including your home) to children or grandchildren? Unlocks the Residence Nil-Rate Band (RNRB) of £175,000 per person if eligible	NoYes YES

Estate Value

Property value

Current market value of your main residence

Outstanding mortgage

Deducted to give net property equity in your estate

Savings & investments

Cash, ISAs, shares, bonds, etc.

Pension assets (if in estate)

Currently outside IHT; proposed for inclusion from April 2027

Other assets

Vehicles, jewellery, business interests, other property

Debts & liabilities

Loans, credit cards, funeral costs (excluding mortgage above)

Gifts Made in the Prior 7 Years (Potentially Exempt Transfers)

Add gifts made in the last 7 years. Exclude the £3,000 annual exemption, gifts of up to £250 per person, wedding gifts within HMRC limits, and gifts out of regular surplus income — these are always IHT-free. Gifts that survive 7 years fall completely outside your estate.

Description	Amount (£)	When made	IHT status

Taper relief reference — relief reduces the IHT charged on gifts, but only where cumulative gifts exceed the nil-rate band:

0–3 yrs

relief (40% IHT)

3–4 yrs

20%

relief (32% IHT)

4–5 yrs

40%

relief (24% IHT)

5–6 yrs

60%

relief (16% IHT)

6–7 yrs

80%

relief (8% IHT)

Additional Allowances & Reliefs

Spouse / civil partner unused NRB

Up to £325,000 transferable from a deceased spouse's unused nil-rate band

Spouse / civil partner unused RNRB

Up to £175,000 transferable from a deceased spouse's unused RNRB

Charitable bequests

IHT-exempt; reduces tax rate to 36% if ≥ 10% of net estate

Estimated inheritance tax liability

£0

Gross estate

—

Net estate (after debts)

—

Total gifts (PETs)

—

IHT rate applied

—

Nil-rate band (NRB) available

—

Residence NRB (RNRB)

—

Total tax-free allowance

—

Taxable estate

—

Estate calculation breakdown

Component	Amount

Gift analysis — 7-year rule

Gift	Amount	NRB absorbed	Taxable amount	Taper rate	IHT on gift

Produced by Sean Fane, Fane Financial Services — sean@fanefinancialservices.co.uk | Tel: 07795 694322
This illustration is for information purposes only and does not constitute financial or tax advice. Calculations are based on 2025/26 HMRC rates for England, Wales and Northern Ireland. The RNRB is tapered at £1 for every £2 the net estate exceeds £2,000,000. Pension assets are currently excluded from IHT but are proposed to be included from April 2027. Taper relief applies only where the value of gifts exceeds the available nil-rate band. Individual circumstances vary — please consult a qualified financial adviser or solicitor.

UK Inheritance Tax Illustration — 2025/26