Inheritance Tax grossing up calculator
Use this calculator to gross up an estate, when the will leaves 鈥榝ree of tax鈥� gifts and the residue is partly or completely exempt from Inheritance Tax.
When someone dies, they can leave gifts in their will 鈥榝ree of tax鈥�. This does not mean there鈥檚 no Inheritance Tax to pay. 听
It means the person receiving the gift gets the full amount stated. If any Inheritance Tax is due, it鈥檚 taken from the rest of the estate (the residue).
Grossing up is the process of working out how much of the estate is liable for Inheritance Tax. It鈥檚 needed when both:听听
- someone that鈥檚 liable for Inheritance Tax (a chargeable beneficiary) is left a 鈥榝ree of tax鈥� gift in the will
- the residue is partly or completely exempt from Inheritance Tax
When to use听
You can use the calculator for:听听
- simple grossing up 鈥� where all gifts are 鈥榝ree of tax鈥� and the residue is completely exempt听
- four-stage grossing up 鈥� where some gifts are 鈥榝ree of tax鈥� and some are not, or all gifts are 鈥榝ree of tax鈥� and the residue is partly exempt听
In some situations, grossing up is more complicated. Do not use the calculator if either of these apply:听听
- Successive charges relief (also called quick succession relief) 鈥� where Inheritance Tax is reduced because the estate includes assets that Inheritance Tax has recently been paid on
- 鈥楤enham鈥� grossing 鈥� where the will has specific instructions about how the residue should be divided between chargeable and exempt beneficiaries听
In these situations, we鈥檒l do the grossing up for you. Request this in the additional information box or cover letter when you complete your Inheritance Tax account on form IHT400.
Before you start听
You鈥檒l need a copy of the will. You鈥檒l also need to know these details about the estate:听
- the total 鈥痸alue of the assets and liabilities 听
- the nil rate band that applies, which is the Inheritance Tax threshold minus any lifetime gifts听
- if any transferable nil rate band applies听
- if any residence nil rate band applies听
- if the reduced rate of Inheritance Tax applies听
Use the calculator
To use the calculator, you鈥檒l need to:
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Get all of your information together before you start. You鈥檒l use the calculator online and you cannot save your progress
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Use the calculator
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Print the results
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Post them to HMRC along with your Inheritance Tax account (IHT400)
Interaction rules听
Interaction rules apply if the estate gets agricultural or business relief, and all of these apply:听
- the will has at least one specific gift of property听
- the will has property subject to tax relief that鈥檚 not given as a specific gift听
- some of the estate is exempt from Inheritance Tax听
You can use the calculator if interaction rules apply, but only after manually deducting agricultural or business relief. 听
Interaction calculations can get complicated. We鈥檒l do them for you if you request it when you submit your return.听
If something changes
If something changes after you submit your Inheritance Tax account, you can submit a corrective account with new grossing up.听听
Use the calculator again, updating any figures that have changed. Print your results and post them with the corrective account.听听
Detailed guidance听
For detailed information about grossing up, check the Inheritance Tax manual section on 鈥楥alculating the chargeable estate鈥�.