Can I leave everything to my spouse without paying inheritance tax?

Yes. Transfers between married couples and civil partners are exempt from IHT, regardless of the amount. This is known as the spouse exemption. However, it defers rather than eliminates IHT, as the tax may be payable on the second death. The spouse exemption is one of the most valuable IHT exemptions. Transfers between spouses and civil partners are exempt from IHT, regardless of the amount. This means that the first spouse can leave their entire estate to the surviving spouse with no IHT payable on the first death. However, the spouse exemption does not eliminate IHT — it merely defers it. If the surviving spouse's estate exceeds the combined allowances (nil-rate band + residence nil-rate band, potentially doubled through transfer), IHT will be payable on the second death. The spouse exemption applies to UK-domiciled spouses. For non-UK-domiciled spouses (where one spouse is non-UK-domiciled), the exemption is capped at £390,000 (the amount of the nil-rate band that would be available to the non-domiciled spouse). With the abolition of the domicile-based remittance basis from April 2025, the position of non-UK-domiciled spouses is changing, and specialist advice is needed. Relevant legislation: Inheritance Tax Act 1984, Section 18 (spouse exemption); Section 18(2) (domicile-based limit). Example: A married couple has a combined estate of £1.5 million. If the first spouse dies leaving everything to the surviving spouse, no IHT is due (spouse exemption). When the surviving spouse dies, the estate of £1.5 million has allowances of £650,000 NRB + £350,000 RNRB = £1 million (assuming the RNRB is not tapered). IHT is charged on £500,000 at 40% = £200,000. Common mistake: Assuming that the spouse exemption eliminates IHT entirely. It only defers it to the second death. Planning is needed to address IHT on the second estate.

How does the transferable nil-rate band work for married couples?

When the first spouse dies, any unused nil-rate band is transferred to the surviving spouse. If 100% of the NRB is unused (e.g., because everything was left to the surviving spouse), the second estate has a combined NRB of £650,000. The transferable nil-rate band (TNRB) allows the unused portion of the first spouse's nil-rate band to be transferred to the surviving spouse. The transfer works as follows: (1) On the first death, the executors calculate the percentage of the nil-rate band that was unused. (2) If the first spouse left everything to the surviving spouse (using the spouse exemption), 100% of the NRB is unused. (3) If the first spouse left some assets to other beneficiaries (e.g., children), the NRB is used proportionally. (4) The unused percentage is transferred to the surviving spouse. (5) On the second death, the executors claim the transferred NRB, which increases the available NRB. For example, if 100% of the first spouse's NRB is unused, the second estate has a combined NRB of £650,000 (£325,000 × 2). The transfer is claimed by the executors of the second estate on the IHT return, using form IHT402. The executors need the first spouse's death certificate and probate documents. Relevant legislation: Inheritance Tax Act 1984, Sections 8A-8B (transferable nil-rate band). Example: A married couple has a combined estate of £800,000. The first spouse dies leaving everything to the surviving spouse (100% of NRB unused). On the second death, the estate has a combined NRB of £650,000 and a combined RNRB of £350,000 (if the RNRB is available), giving a total of £1 million. As the estate is £800,000, no IHT is due. Common mistake: Failing to claim the transferable nil-rate band on the second death. The executors must actively claim it using form IHT402 and the first spouse's documents. Without a claim, the allowance is lost.

How does the transferable residence nil-rate band work?

Any unused residence nil-rate band from the first spouse's death can be transferred to the surviving spouse. This can double the RNRB to £350,000, giving a combined allowance of up to £1 million when combined with the transferable NRB. The transferable residence nil-rate band works similarly to the transferable nil-rate band. Any unused RNRB from the first spouse's death can be transferred to the surviving spouse. If 100% of the RNRB is unused (e.g., because the first spouse left everything to the surviving spouse, or the estate was below the threshold), the second estate has a combined RNRB of £350,000 (£175,000 × 2). Combined with the transferable NRB of £650,000, the total allowance for the second estate is up to £1 million. However, the RNRB taper still applies — if the second estate exceeds £2 million, the RNRB (including the transferred portion) is tapered away. The transferable RNRB is claimed by the executors of the second estate on the IHT return, using form IHT436. The executors need the first spouse's death certificate and details of the first estate's IHT position. Relevant legislation: Inheritance Tax Act 1984, Sections 8D-8F (residence nil-rate band including transferability). Example: A married couple owns a family home worth £700,000 and other assets worth £300,000. The first spouse dies leaving everything to the surviving spouse (100% of NRB and RNRB unused). On the second death, the estate of £1 million has a combined NRB of £650,000 and a combined RNRB of £350,000, giving a total of £1 million. As the estate equals £1 million and is below the £2 million taper threshold, no IHT is due. Common mistake: Assuming the RNRB taper threshold doubles for married couples. The taper starts at £2 million for the second estate, even when claiming two RNRBs. A £2.5 million estate would lose most of the RNRB.

What happens to IHT if we are not married?

Unmarried couples do not benefit from the spouse exemption. Transfers between unmarried partners are potentially exempt transfers (subject to the 7-year rule), and there are no transferable allowances. This can result in significant IHT bills compared to married couples. Unmarried couples do not have the same IHT advantages as married couples and civil partners. Key differences: (1) No spouse exemption — transfers between unmarried partners are potentially exempt transfers (PETs), subject to the 7-year rule. If one partner dies within 7 years of making a gift to the other, IHT may be payable. (2) No transferable allowances — there is no transferable nil-rate band or RNRB. Each partner's estate has only their own allowances (£325,000 NRB + £175,000 RNRB = £500,000 maximum). (3) Jointly-owned property — when one cohabiting partner dies, their share of jointly-owned property is part of their estate for IHT purposes. The surviving partner may need to pay IHT to retain the property. (4) Wills — without a will, the rules of intestacy apply, which do not provide for unmarried partners (unless the property is jointly owned as joint tenants). These differences mean that unmarried couples should seek specialist advice to plan their estates effectively, potentially using wills, trusts, and lifetime gifting. Relevant legislation: Inheritance Tax Act 1984, Section 18 (spouse exemption — married couples only); intestacy rules (Administration of Estates Act 1925). Example: An unmarried couple owns a home worth £800,000 (as tenants in common, each owning 50%). If one partner dies, their share of £400,000 is part of their estate. After the nil-rate band of £325,000, IHT is charged on £75,000 at 40% = £30,000. The surviving partner may need to pay this IHT to retain the property. If they were married, the spouse exemption would apply and no IHT would be due on the first death. Common mistake: Assuming that cohabiting partners have the same IHT rights as married couples. Unmarried couples should seek specialist advice and ensure they have wills that reflect their wishes.

Should married couples use nil-rate band trusts in their wills?

Nil-rate band trusts (NRB trusts) in wills can be useful for protecting assets and managing the first death's IHT position. However, since the introduction of the transferable nil-rate band, NRB trusts are less commonly needed for pure IHT savings. A nil-rate band trust (NRB trust) is a trust established in a will that receives assets up to the value of the nil-rate band on the first death. The assets in the trust are outside the surviving spouse's estate, potentially reducing IHT on the second death. Before the introduction of the transferable nil-rate band (2007), NRB trusts were widely used to ensure that the first spouse's NRB was not wasted (since leaving everything to the surviving spouse would use the spouse exemption but not the NRB). However, since 2007, the transferable NRB allows the unused NRB to be transferred to the surviving spouse without the need for a trust. Despite this, NRB trusts are still used for: (1) Asset protection — protecting assets from the surviving spouse's remarriage, care home fees, or creditors. (2) Control — ensuring that the first spouse's assets pass to their chosen beneficiaries (e.g., children from a previous relationship). (3) Flexibility — giving trustees discretion over distributions. The decision to use an NRB trust depends on the family circumstances and objectives, not just IHT savings. Specialist advice is essential. Relevant legislation: Inheritance Tax Act 1984, Sections 8A-8B (transferable NRB); trust law provisions. Example: A married couple has a combined estate of £1.5 million. The first spouse's will includes an NRB trust that receives £325,000 on the first death. The trust assets are outside the surviving spouse's estate. On the second death, the estate is £1.175 million with a combined NRB of £325,000 (only the surviving spouse's, as the first was used by the trust). However, the transferable NRB may provide a better outcome — if the first spouse left everything to the surviving spouse, the second estate would have a combined NRB of £650,000. The NRB trust may still be used for asset protection reasons. Common mistake: Using an NRB trust for IHT savings when the transferable NRB achieves the same result more simply. NRB trusts should be used for asset protection and control, not just tax savings.

How does the RNRB taper affect married couples?

The RNRB taper applies to the second estate. If the second estate exceeds £2 million, the RNRB (including the transferred portion from the first spouse) is tapered away by £1 for every £2 of estate value above £2 million. The RNRB taper applies to the estate of the second spouse to die. The taper threshold is £2 million — for every £2 of estate value above £2 million, the RNRB is reduced by £1. This applies to the total RNRB available to the second estate, including any transferred RNRB from the first spouse. The taper threshold does not double for married couples — it remains £2 million for the second estate, even when claiming two RNRBs. This means that a married couple with a combined estate above £2 million may lose some or all of the RNRB. For example, if the second estate is £2.7 million, the RNRB is tapered away entirely (the taper removes £350,000 of RNRB, which requires £700,000 of estate value above £2 million). The combined NRB of £650,000 is still available, but the combined RNRB of £350,000 is lost. Relevant legislation: Inheritance Tax Act 1984, Section 8D(2)-(3) (taper provisions); Sections 8D-8F (RNRB including transferability). Example: A married couple has a combined estate of £2.5 million, including a qualifying residence. The first spouse dies leaving everything to the surviving spouse. On the second death, the estate of £2.5 million has a combined NRB of £650,000 and a combined RNRB of £350,000. However, the RNRB taper applies: the estate exceeds £2 million by £500,000, reducing the RNRB by £250,000. The effective RNRB is £100,000 (£350,000 - £250,000). Total allowance: £650,000 + £100,000 = £750,000. IHT is charged on £1.75 million at 40% = £700,000. Common mistake: Assuming the RNRB taper threshold doubles for married couples. The threshold remains £2 million for the second estate, meaning high-value combined estates may lose most or all of the RNRB.

IHT Advisory › Planning

IHT for Married Couples & Civil Partners

Married couples and civil partners have significant IHT advantages, including spouse exemption and transferable allowances. Understand how to maximise these benefits and pass on up to £1 million tax-free.

Book an IHT Consultation +44 (0) 800 211 8657

Married couples and civil partners have significant inheritance tax advantages compared to unmarried couples. The spouse exemption allows unlimited tax-free transfers between spouses, and transferable nil-rate band and residence nil-rate band can double the available allowances. Understanding these advantages and planning effectively as a couple can save hundreds of thousands of pounds in IHT.

Spouse Exemption

Transfers between spouses and civil partners are exempt from IHT, regardless of the amount. This means that the first spouse can leave their entire estate to the surviving spouse with no IHT payable. However, this does not eliminate IHT — it merely defers it to the second death. If the surviving spouse's estate exceeds the combined allowances, IHT will be payable on the second death. The spouse exemption only applies to UK-domiciled spouses — there are special rules for non-UK-domiciled spouses (the exemption is capped at £390,000).

Transferable Nil-Rate Band

When the first spouse dies, any unused nil-rate band can be transferred to the surviving spouse. If the first spouse left everything to the surviving spouse (using the spouse exemption), 100% of the nil-rate band is unused and available for the second estate. This means the second estate has a combined nil-rate band of £650,000 (£325,000 × 2). The transfer is claimed by the executors of the second estate on the IHT return.

Transferable Residence Nil-Rate Band

Similarly, any unused residence nil-rate band can be transferred to the surviving spouse. If the first spouse's estate did not use the RNRB (e.g., because the estate was below the threshold, or the property was not passed to descendants), the RNRB is available for the second estate. This means the second estate can have a combined RNRB of £350,000 (£175,000 × 2), giving a total combined allowance of £1 million (£650,000 NRB + £350,000 RNRB). However, the RNRB taper still applies — if the second estate exceeds £2 million, the RNRB (including the transferred portion) is tapered away.

Planning for Couples

Effective IHT planning for married couples involves: (1) Using wills to structure the first death effectively — for example, using a 'nil-rate band trust' or direct gifts to children to preserve the RNRB. (2) Considering the impact of the RNRB taper on the second estate. (3) Making lifetime gifts as a couple (doubling the annual exemption). (4) Reviewing the ownership of assets (joint tenancy vs tenants in common). (5) Considering life insurance written in trust to cover IHT on the second death. Specialist advice is essential to ensure both spouses' estates are planned effectively.

Key Points

What You Need to Know

Transfers between spouses are exempt from IHT (spouse exemption)
Unused nil-rate band can be transferred to the surviving spouse
Unused residence nil-rate band can also be transferred
Married couples can potentially pass on up to £1 million tax-free
The RNRB taper still applies to the second estate above £2 million

Expert Answers

Inheritance Tax Frequently Asked Questions

Detailed answers with legislation references, practical examples and common pitfalls.

Explore More

All IHT Topics

Nil-Rate Band & Residence Nil-Rate Band Business Property Relief (BPR)April 2026 IHT Changes Agricultural Property Relief (APR)Lifetime Gifting & the 7-Year Rule Trusts & Inheritance Tax IHT for Married Couples IHT on Property & Estates IHT for Business Owners IHT Exemptions & Reliefs IHT on Foreign Assets IHT Planning Strategies IHT Rate & Calculation

Need Specialist IHT Advice?

Our inheritance tax advisers can help you plan effectively, protect your wealth, and minimise IHT. Get clear, practical advice tailored to your circumstances.

Book a Consultation Call +44 (0) 800 211 8657