Inheritance Tax (IHT) 2016/17

A historical record of Inheritance Tax in the UK for the tax year 2016/2017

The following information is a historical record of the Inheritance Tax in the United Kingdom for the tax year 2016/2017. The information was correct at the time of publication.

If you are looking for this tax year’s information, please visit our resources section, where you can find recent Inheritance Tax information.

Latest tax rates & allowances


Rates and thresholds

Nil rate band£325,000£325,000
Tax paid on legacies on death40%40%
Tax paid if at least 10% of net estate
is left to charity on death
Gifts made up to seven years before
death (see lifetime gifts)
Lifetime transfers to most trusts (note 5)20%20%


  1. Up to 100% of the proportion of a deceased spouse’s/civil partner’s unused nil rate band may be claimed to increment the current nil rate band when the survivor dies.
  2. Gifts or legacies to charities are not charged to IHT.
  3. If the donor pays the IHT due on a lifetime gift the effective rate is 25%.
  4. IHT due on a deceased’s estate and on gifts within seven years of death is generally due six months after the month of death, but in practice it must be paid before probate is granted.
  5. IHT on chargeable lifetime transfers to trusts is payable on the later of six months after the month of transfer, or 30 April in the next tax year.

Lifetime gifts

Reduced tax charge on gifts up to seven years before death
Years before death0-33-44-55-66-7
Percentage of IHT
death charge payable


Lifetime gifts between individuals (‘potentially exempt transfers’) are only charged to IHT if the donor dies within seven years of the gift.

Exempt gifts

Amount of reliefConditions
£3,000 per tax yearAmount per donor; unused exemption can can be carried forward one year
£250 per tax yearDe minimis amount per recipient
UnlimitedRegular gifts out of surplus income
UnlimitedTo UK domiciled spouse or civil partner
£325,000To non-domiciled spouse/civil partner
£5,000From parent of party to marriage (see note)
£2,500From party to marriage or from remoter ancestor (see note)
£1,000From any other person (see note)


Must be made to one or both parties to a marriage in consideration of that marriage. These rules apply equally to those entering a civil partnership.

Business and agricultural property

Amount of reliefProperty and conditions
100%All shareholdings in unquoted trading companies, an unincorporated business or interest in such a business
50%Controlling shareholding in quoted company, land and buildings used by transferor’s company or partnership
100%Agricultural value of qualifying farmland and buildings


In all cases the property must have been owned for at least two years, and other conditions apply.