From 6 April 2017, the Residential Nil Rate Band (RNRB) became available for residences inherited by direct descendants (see below) in addition to the existing Nil-Rate Band (NRB) which is currently £325,000.

From 2017/18 the RNRB was phased in, starting at £100,000, and increasing by £25,000 each year until 2020/21 when it reached the maximum level of £175,000 (frozen until at least April 2026). The current rate of NRB will be frozen at £325,000 during this period.

As with the NRB, any unused RNRB can be transferred to a surviving spouse or civil partner, with the effect that the maximum combined IHT threshold for such couples cold be a total of £1m from 6 April 2020.