Malcolm Finney looks at the inheritance tax residence nil rate band, and what or how any transfer can be effected.
The residence nil rate band (RNRB) was introduced in F(No2)A 2015 and modified by FA 2016; it came into effect with respect to deaths occurring on or after 6 April 2017 (IHTA 1984, ss 8D to 8M).
The amount of RNRB has varied; £175,000 for the tax year 2020/21; £150,000, £125,000; and £100,000 for the earlier tax years 2019/20; 2018/19 and 2017/18 respectively (IHTA 1984, s 8D(5)).
The RNRB is available only on death. Any unused element on the death of the first spouse to die may be transferred to the surviving spouse (any transfer must be claimed on Form IHT436). Where the first spouse death occurred prior to 6 April 2017, by definition, the RNRB was unused (hence 100% is available for transfer).
