Budget summary 2017
As previously announced, the nil rate band remains frozen at £325,000 until the end of 2020/21. The 'residential enhancement', announced in the Summer 2015 Budget, begins to take effect for death transfers from 6 April 2017. This will apply an additional nil rate band, initially £100,000 and rising to £175,000 by 2020/21, where a taxpayer's main residence is left to direct descendants. A married couple will potentially then be able to leave £1 million free of IHT to their descendants (£325,000 plus £175,000 from each parent), but the rules are complicated and their operation is untested.