The nil-rate band has been held at £325,000 since 2009 and is set to stay there until April 2031. Had it risen with inflation, it would be worth far more today.
By 2025 the gap between the frozen band and an inflation-indexed one had reached about £200,000. Because the threshold has not moved while asset and care costs have, more ordinary estates are pulled above it each year, before any of the estate passes on.
Frozen nil-rate band: held at £325,000 since 2009; freeze extended to 2031 at the Autumn Budget 2025 (Autumn Budget 2025, Inheritance Tax measures).
Inflation-indexed line: £325,000 indexed by the ONS Consumer Prices Index (2015=100) for each year (ONS CPI series). Points to 2025 are sourced; 2026 to 2031 is projected at the Bank of England's 2% CPI target (dashed).
This chart is for illustrative purposes only.