Does legacy NRB wording include RNRB?

A Will predating RNRB says:

“I give my available Nil Rate Band tax allowance to xxxxx”

Can this be interpreted as including RNRB?

Any thoughts would be much appreciated
Rachel Stafford
Rachel Stafford Legal Services.

As the gift is neither of residue, nor specifically includes residential property, I believe not.

Paul Saunders

The IHTA refers to the residential nil rate amount as an extra nil rate band in the heading to section 8D. So any reference to a nil rate band in a Will could be taken to refer to the RNRB as well.

However, if the Will was made before the provisions came into effect, the testator could not have been aware of them, so arguably the term should not include the RNRB.

On the other hand, it could be interpreted to mean the maximum amount that could pass free of iht. If this interpretation is correct, and if the residence passed to children etc elsewhere in the Will, then it could include the RNRB.

Much depends on the provisions in the Will and the testator’s intentions.

If the only or main asset is a residence, then if the gift is in favour of children etc, perhaps HMRC would agree that of necessity it must include a share of the residence as there is no other asset which could satisfy the gift, so the RNRB applies?

Simon Northcott

No I don’t believe it does. You can’t treat the NRB the same as the RNRB. You always have the NRB as a sum that can be given, so you can give it a a pecuniary legacy. You can’t do the same with the RNRB. You have to give the property (explicitly or as residue) to lineal descendants to enable your executors tp claim the allowance when they complete the IHT forms.

Andy Parker

Director, Cornerstone Wills Ltd

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