The law is always changing and when your area of specialism includes tax you can always count on legislation to keep you on your toes!

In 2017 we saw the introduction of the Residence Nil Rate Band (RNRB), more commonly known as the ‘family home allowance’. This is an allowance to reduce the Inheritance Tax (IHT) liability on death and it could save you thousands in death duties. Briefly:

• The RNRB has started at £100,000 per person but is to rise by £25,000 per annum up to April 2020 when it will be £175,000 each
• There are conditions attached – you must own (or in some cases have owned) a residence which you can offset this allowance against
• You must leave your residence to your direct descendants – although this is wider than simply children and grandchildren
• You can have sold or given away your house, or downsized, and still get the full amount in some cases
• It is transferrable between spouses on death if unused – even if the first spouse died before these rules came into force!

Like many new tax rules, the legislation introducing the RNRB is not straightforward or easy to understand. If your estate is over the existing Nil Rate Band of £325,000 then you need to consider whether you are eligible for the new RNRB which could potentially save you £70,000 (and with your spouse £140,000) by 2020.