Inheritance-tax thresholds: history and the freeze
Last reviewed 18 August 2026
Few figures in tax stand as still as the nil-rate band, and its very stillness is the point — while prices and house values climb, the threshold does not move.
The frozen bands
The nil-rate band is £325,000 and the residence nil-rate band up to £175,000. Following the 2024 and 2025 Budgets, both — along with the £2 million residence-band taper threshold — are frozen until 5 April 2031. The nil-rate band itself has stood at £325,000 since 2009.
Fiscal drag
Because the thresholds are frozen while asset values rise, more estates are drawn into inheritance tax each year without any change in the law — a quiet increase economists call “fiscal drag”. It is the reason a tax once thought to touch only the wealthy now reaches many ordinary homeowners, and why planning has become more widely relevant.
Questions
How long is the nil-rate band frozen?+
Has £325,000 changed recently?+
Sources. GOV.UK, Inheritance Tax rates and allowances; 2024 and 2025 Budgets (NRB/RNRB/taper freeze to 5 April 2031).