RNRB and using up part

Husband (H) died owning all of the family home (and also some cash assets). H died intestate, leaving a widow and three adult children. Based on the value of the assets and the application of the intestacy rules, there is no IHT to pay as the amount passing to the children is less than the NRB (ignoring the availability of any RNRB).
However, if the estate includes a property and part of the estate passes to the children, is a proportion of H’s RNRB used up, even though it is not actually needed, meaning that only a reduced TRNRB will be available on the widow’s subsequent death? (I realise that a deed of variation could be used but I am just interested in this particular point for now)
I would be grateful for the views of others on this.

N Waldman
HJA Solicitors

My understanding is that the RNRB is applied before the nil rate band.

If that is the case, then in the situation described by Mr Waldman the carried forward RNRB available to his widow’s estate is reduced.

I wonder if that really is the intention of the legislature. It is likely to add further complexities for the personal representatives (and HMRC?) when the widow, or anyone else in a similar situation, dies.

I’d be delighted to be wrong on the implications of the RNRB being the first slice of the estate.

Paul Saunders FCIB TEP

Independent Trust Consultant

Providing support and advice to fellow professionals

The RNRB is applied against an estate in priority to the NRB [IHTA 1984 s 8D(3)].

The legislation applies the RNRB automatically if the relevant conditions are satisfied.

The legislation merely refers to the RNRB as to be applied for the purposes of calculating the amount of IHT charge on a person’s death [IHTA 1984 s 8D(1)]. IHTA 1984 s 8F(2) provides that where s8F(1) applies a person’s RNRB will be nil. No claim is necessary.

However, a specific claim is required with respect to the brought forward allowance or the downsizing addition [IHTA 1984 s 8L(1)].

Malcolm Finney

Thank you to Paul and Malcolm for their replies.

Malcolm – can I just clarify what you are saying? Ie that a proportion of the TRNRB will be lost in this case, as the legislation applies automatically to this situation?

Many thanks

Nicola Waldman | Partner | For Hodge Jones & Allen Solicitors



In my view, yes.

The RNRB is, as is the NRB, part of the calculation and thus if the RNRB conditions are satisfied it is automatically applied.

Malcolm Finney