When dealing with probate and inheritance tax, two forms that often cause confusion are IHT435 and IHT436. These forms are used to claim valuable inheritance tax allowances that can significantly reduce the amount of tax payable on an estate.

In this guide, we'll explain what the IHT435 and IHT436 forms are, when they are required, who can use them, and how they could save an estate up to £140,000 in inheritance tax.

The Residence Nil Rate Band (RNRB) is an additional inheritance tax allowance available when a qualifying residential property is left to direct descendants, such as children, stepchildren, adopted children or grandchildren.

The allowance is currently worth up to £175,000 per person, on top of the standard Inheritance Tax Nil Rate Band of £325,000. This means an individual may potentially pass on up to £500,000 free of inheritance tax.

Married couples and civil partners may be able to pass on up to £1 million where both allowances are available and transferable. 

Form IHT435 is used to claim the Residence Nil Rate Band against the estate of someone who died on or after 6 April 2017.

You may need to complete Form IHT435 if:

• The deceased owned a qualifying residential property (not rental property)
• The property is being inherited by direct descendants.
• The estate is claiming the Residence Nil Rate Band.
• A downsizing addition claim is required because the deceased sold or downsized their home after 8 July 2015.

Form IHT436 is used to claim any unused Residence Nil Rate Band from a previously deceased spouse or civil partner. HMRC refers to this as the Transferable Residence Nil Rate Band (TRNRB).

The form allows an estate to transfer any unused percentage of the Residence Nil Rate Band from the first spouse to die to the surviving spouse's estate. So in effect for a couple of parents who have died and left their home to their children (above 18), there are potentially 2 x £175,000 allowances available.

This can potentially double the available Residence Nil Rate Band allowance.

You may need Form IHT436 where:

• The deceased was widowed or had previously been in a civil partnership.
• The first spouse or civil partner did not fully use their Residence Nil Rate Band.
• You are already claiming the Residence Nil Rate Band using Form IHT435.
• In most cases, Form IHT436 cannot be used on its own and accompanies Form IHT435.

John dies in 2026 leaving his home worth £400,000 and other assets worth £250,000 to his children.

His wife died several years earlier and did not use any of her Residence Nil Rate Band.

John's estate may be entitled to:

* Standard Nil Rate Band: £325,000
* Transferable Nil Rate Band: £325,000
* Residence Nil Rate Band: £175,000
* Transferable Residence Nil Rate Band: £175,000 (100%)

This could provide total inheritance tax allowances of up to £1 million, potentially eliminating any inheritance tax liability on the estate.

Are you looking for help to complete the IHT400 form or the IHT435 and IHT436 forms? Give the Let's Do Probate team a call on 0330 229 0319 , and we’ll be happy to help. You can schedule a free timed call to suit you, using our online booking system here