Part 2: Inheritance Tax Section 9: Increased nil-rate band on death where home inherited by descendants etc. Details of the section Section 8E: Residence nil-rate amount: interest in home goes to descendants etc.
New section 8E sets out more detailed rules for calculating the actual amount of the residence nil-rate band due for an estate (the "residence nil-rate amount") and the amount that can be transferred to a spouse or civil partner.
	Subsection (1) ensures that the residence nil-rate band only applies where a person's estate includes a qualifying residence (the qualifying residential interest) and some or all of that property is left to one or more direct descendants, i.e. it is closely inherited. It ensures that the value attributable to the qualifying residential interest is the value after deducting any reliefs such as agricultural property relief and business property relief.
	Subsection (2) provides that, for estates at or below the taper threshold, where the value of the residence inherited by direct descendants is less than a person's total available residence nil-rate band (the default allowance), the residence nil-rate amount is limited to the value of the residence. Any unused excess is available to transfer to a spouse or civil partner.
	Subsection (3) provides that, for estates at or below the taper threshold, where the value of the residence inherited by direct descendants is greater than or equal to the person's default allowance, the residence nil-rate amount is equal to the default allowance. None of the residence nil-rate band is available for transfer to a spouse or civil partner.
	Subsection (4) provides that, for estates above the taper threshold, where the value of the residence inherited by direct descendants is less than the person's adjusted allowance after taper has been applied, the residence nil-rate amount is limited to the value of that residence. Any unused excess is available for transfer to a spouse or civil partner.
	Subsection (5) provides that, for estates above the taper threshold, where the value of the residence passed to direct descendants is greater than or equal to the person's adjusted allowance, the residence nil-rate amount is equal to the adjusted allowance. None of the residence nil-rate band is available for transfer to a spouse or civil partner.
	Subsection (7) applies where the value of the residence is greater than the net value of the estate after liabilities have been deducted. The residence nil-rate amount is restricted to the value of the chargeable estate and the unused excess is available to transfer to a spouse or civil partner.
	Subsection (8) lists other sections that should also be considered.