On a £600,000 estate with a home left to your children, the Inheritance Tax bill is £40,000 — because the £500,000 threshold leaves £100,000 taxed at 40%. Enter your estate below to estimate the IHT due, with the residence band and spouse transfers handled for you.
England, Wales, Scotland & Northern Ireland · 2026/27
Inheritance Tax (IHT) is charged at 40% on the value of an estate above the tax-free threshold. Two allowances make up that threshold, and a surviving spouse or civil partner can inherit any unused portion of both.
| Allowance | Per person | Transferable to spouse |
|---|---|---|
| Nil-rate band | £325,000 | Yes — up to £650,000 |
| Residence nil-rate band | £175,000 | Yes — up to £350,000 |
| Combined (couple) | — | Up to £1,000,000 |
| IHT rate | 40% | 36% if 10%+ left to charity |
Here is how the calculator reaches the figure for a £600,000 estate where the home is left to children:
Without the residence band, the same estate has only a £325,000 threshold, so £275,000 is taxed at 40% — an IHT bill of £110,000. The home-to-children rule is worth £70,000 of tax here.
Several reliefs and allowances can cut an IHT bill:
If the estate includes a home left to children or grandchildren, the threshold is £500,000 and £100,000 is taxed at 40% — an IHT bill of £40,000. Without the residence band the threshold is £325,000 and the tax would be £110,000.
It is an extra £175,000 tax-free allowance that applies when you leave your home to your children or grandchildren. With the £325,000 nil-rate band, an individual's threshold can reach £500,000.
Yes. Unused nil-rate and residence bands pass to a surviving spouse or civil partner, so a couple can leave up to £1 million free of Inheritance Tax. See GOV.UK.
