NIL RATE BAND:
 
When a person dies HM Revenue & Customs collect Inheritance Tax on the deceased's Estate, which is the total value of all money and property at the date of death and any gifts made 7 years prior to death.
 
The rate of Inheritance Tax is presently 40% with discounts applying to gifts made between 3 and 7 years prior to death.
 
However, HMRC allows a tax free amount of £325,000 whereby tax is not charged. This is called the NIL RATE BAND.
 
A married person can claim the Nil Rate Band of a deceased spouse (husband/wife) if that spouse did not use his/her Nil Rate Band when he/she died. This is called a Transferable Nil Rate Band. Therefore on the death of a married person up to double the present Nil Rate Band can be claimed.