IHTM46060 - Downsizing Calculations: overview

For the downsizing provisions to be in point, there must have been a ‘residential property interest� (IHTM46011) in a person’s estate on or after 8 July 2015 which has either been disposed of, or downsized from, before the date of death.

»Ê¹ÚÌåÓýapp downsizing rules are designed to replace RNRB that has been lost due to the downsizing or disposal. »Ê¹ÚÌåÓýappy are not designed to replace RNRB that has been lost because a residential property interest in the estate on death is not closely inherited.

»Ê¹ÚÌåÓýapp general approach to determining the downsizing addition (IHTM46050) is to establish:

  • the amount of RNRB that has been lost as a result of the disposal â€� the ‘lost relievable amountâ€�, and
  • the value of property (other than any QRI) that is being closely inherited (IHTM46052) on the death.

»Ê¹ÚÌåÓýapp downsizing addition is the lower of these two amounts.

»Ê¹ÚÌåÓýappre are slightly different rules and slightly different calculations depending on whether:

  • there is a QRI (IHTM46011) in the estate on death (IHTM46061), or
  • there is no residential property interest in the estate on death (IHTM46064).