Q&As

A, who died before 6 April 2017, left a life interest in their residential property to B, with remainder to B, C and D, who are all children of A. B dies and leaves the whole of his estate to his two children, E and F. To what extent is the residence nil rate band available in respect of the residential property on B’s death?

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Published on LexisPSL on 01/06/2018

The following Private Client Q&A provides comprehensive and up to date legal information covering:

  • A, who died before 6 April 2017, left a life interest in their residential property to B, with remainder to B, C and D, who are all children of A. B dies and leaves the whole of his estate to his two children, E and F. To what extent is the residence nil rate band available in respect of the residential property on B’s death?
  • Meaning of QRI and RPI
  • Is the RNRB available on A’s death?
  • Is the RNRB available on B’s death?

A, who died before 6 April 2017, left a life interest in their residential property to B, with remainder to B, C and D, who are all children of A. B dies and leaves the whole of his estate to his two children, E and F. To what extent is the residence nil rate band available in respect of the residential property on B’s death?

In answering this Q&A, we have made the following assumptions:

  1. A’s Will accurately and fully reflects A’s wishes with respect to the residential property

  2. B had a qualifying interest in possession (QIIP) in the property within the meaning of the Inheritance Tax Act 1984 (IHTA 1984).

  3. B occupied the property at some time as his residence

For an introduction to the residence nil rate band (RNRB), also known as the residential nil rate band or the additional threshold, see Practice Note: IHT—residence nil rate band.

The RNRB is only available where a qualifying residential interest (QRI) is ‘closely inherited’ on the deceased’s death. It applies to deaths on or after 6 April 2017.

'Inherited' is defined as meaning that the property passes from a person who has died and the property formed part of their estate immediately before death. The disposition of the property may be effected by Will under the law relating to intestacy or 'otherwise', which would include the passing of

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