UK Inheritance Tax Calculator – Estimate Your IHT Liability

Understanding how much Inheritance Tax (IHT) may be due on an estate can feel complicated, especially with multiple allowances, reliefs, and thresholds to consider. Our UK Inheritance Tax Calculator helps you quickly estimate the potential tax payable using current HMRC rules and allowances.

This calculator is designed for individuals, families, and executors who want a clear, reliable estimate of IHT based on the total value of an estate, any outstanding liabilities, and the tax-free allowances that may apply.

Simply enter the value of the estate assets, deduct any debts, and select the relevant reliefs to see an estimated Inheritance Tax figure instantly.

How to Use the UK Inheritance Tax Calculator (Step by Step)

This calculator estimates how much Inheritance Tax (IHT) may be payable on an estate using current HMRC rules. Follow the steps below to get your result.

Step 1: Enter the Value of Estate Assets

Start by entering the estimated market value of all assets in the estate:

• Main residence value – the family home or main property
• Other property value – buy-to-let or additional properties
• Investments – shares, ISAs, bonds, funds
• Cash & savings – bank accounts, cash holdings
• Business / agricultural assets – if applicable
• Pension death benefits – pensions paid into the estate

👉 Enter amounts in pounds (£).
If an asset does not apply, simply leave it blank.

Step 2: Add Liabilities and Debts

Next, enter the total value of any liabilities, such as:

• Outstanding mortgages
• Loans or credit card balances
• Funeral expenses

These amounts are deducted from the estate value before tax is calculated.

Step 3: Select Applicable Allowances & Reliefs

Tick the boxes that apply to the estate:

• Transfer unused spouse or civil partner allowance
  Select this if a spouse or civil partner passed away previously and did not use their full tax-free allowance.
• Home left to direct descendants
  Tick this if the main residence is being passed to children, grandchildren, or other direct descendants. This allows the Residence Nil-Rate Band to apply.
• 10% or more left to charity
  Select this if at least 10% of the estate is being donated to charity, which may reduce the tax rate from 40% to 36%.

Step 4: Calculate Inheritance Tax

Click “Calculate Inheritance Tax”.

The calculator will instantly show:

• Total estate value (after debts)
• Total tax-free allowances used
• Taxable estate value
• Estimated Inheritance Tax payable

All calculations follow current HMRC thresholds, including tapering of allowances for estates over £2 million.

Step 5: Review the Result

Your result provides a clear estimate, helping you understand:

• Whether Inheritance Tax may be due
• How allowances reduce the tax bill
• The potential impact of charitable gifts

This is a planning tool — final tax liability may differ depending on gifts, trusts, exemptions, and individual circumstances.

What This Calculator Takes Into Account

This tool reflects the latest UK Inheritance Tax thresholds, including:

• The Nil-Rate Band of £325,000 per individual
• The Residence Nil-Rate Band of up to £175,000 when a home is passed to direct descendants
• Transferable allowances between spouses or civil partners
• The reduced 36% tax rate when 10% or more of the estate is left to charity
• Tapering of the Residence Nil-Rate Band for estates above £2 million

All calculations follow HMRC guidance to give you a realistic and transparent estimate.

How Inheritance Tax Is Calculated in the UK

Inheritance Tax is usually charged at 40% on the portion of an estate that exceeds the available tax-free allowances. The value of the estate includes property, savings, investments, and certain other assets, minus any debts and funeral expenses.

For many families, careful use of allowances — particularly the Residence Nil-Rate Band and spousal transfers — can significantly reduce or even eliminate an Inheritance Tax bill.

This calculator shows how these allowances may apply to your situation, helping you understand where the tax liability arises.

Who Should Use This Calculator?

This Inheritance Tax calculator is useful if you are:

• Planning your estate and want to understand potential tax exposure
• Acting as an executor or administrator of an estate
• Advising family members on inheritance planning
• Exploring how allowances and reliefs affect IHT

It provides an estimate only, but it’s a strong starting point for financial planning discussions.

Important Notes & Disclaimer

This calculator provides an estimate based on current HMRC thresholds and general rules. Actual Inheritance Tax liabilities can vary depending on individual circumstances, exemptions, lifetime gifts, trusts, and future legislative changes.

For complex estates or formal tax planning, you should consider speaking with a qualified financial adviser, accountant, or solicitor.

Frequently Asked Questions

Is Inheritance Tax always 40%?
No. While the standard rate is 40%, the rate may reduce to 36% if at least 10% of the estate is left to charity.

Do spouses pay Inheritance Tax?
Assets passed to a spouse or civil partner are generally exempt, and unused allowances can usually be transferred.

Does everyone get the Residence Nil-Rate Band?
No. It only applies when a qualifying home is left to direct descendants and may be reduced for larger estates.