Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of inheritance tax rules on housing supply.

The independent Office for Budget Responsibility (OBR) takes inheritance tax into account in its assessments of the housing market. Information can be found at https://obr.uk/forecasts-in-depth/the-economy-forecast/housing-market/.

The estates of all individuals benefit from a £325,000 nil-rate band for inheritance tax. The residence nil-rate band is a further £175,000 for those passing on a qualifying residence on death to their direct descendants, such as children or grandchildren, and there are rules in place to accommodate those wishing to downsize. Information is available at www.gov.uk/guidance/how-downsizing-selling-or-gifting-a-home-affects-the-additional-inheritance-tax-threshold.

The residence nil-rate band was introduced under the previous Government. The OBR’s assessment of its expected impact on the housing market was set out in its Economic and Fiscal Outlook published on 8 July 2015. This is available at https://obr.uk/efo/economic-fiscal-outlook-july-2015/.