Budget 2018: the chancellor has announced minor technical amendments to the Main Residence nil rate band which will have effect for deaths on or after 29 October 2018.

  • The main Residence Nil Rate band (RNRB)  rules on downsizing will be amended to ensure that the value of any part of a residence inherited by an exempt beneficiary, such as a surviving spouse inheriting a deceased spouse’s share of a property, is taken into account in calculating the relief due under the downsizing provisions.
  • The definition of ‘inherited’ will be amended to ensure that where a residence forms part of a person’s estate immediately before their death as a Gift with Reservation of Benefit, such as where they have continued to live in the property, it will only be treated as being inherited by a direct descendant if the property was immediately within the direct descendant’s estate following the original gift.

Useful links:

Budget 2018 live highlights

Budget 2018 summary 

External link

HMRC: Policy paper: IHT: changes to residence nil rate band