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How couples without children can pass on wealth tax-free

5 Feb 26 Emily Malone

If you don’t have children, inheritance planning can feel oddly unclear.

There’s no default path to follow. No assumed beneficiary. And under current UK inheritance tax rules, fewer allowances quietly working in your favour.

That doesn’t put you at a disadvantage, but it does mean the usual assumptions don’t apply to you. Your plan needs to be intentional, shaped around the life you’ve built and the people or causes you want to support.

A recent Sunday Times article highlighted how couples without children can miss out on key inheritance tax allowances, even when they have clear ideas about who they want to support.

Below, we’ll walk through the practical, legitimate ways you can pass on wealth with less tax and more control, whether that’s to a partner, siblings, nieces or nephews, close friends, or causes you care about.

This article is for general guidance only. Tax rules can change and personal circumstances matter. Always seek regulated advice before making decisions.

What “tax-free” really means (and what it doesn’t)

When people say “tax-free”, they usually don’t mean avoiding tax entirely.

They mean:

Keeping inheritance tax to a minimum
Ensuring money goes where they intend, not unnecessarily to HMRC
Avoiding forced decisions (like selling a home quickly to cover tax)

In practice, this often involves combining:

Allowances
Exemptions
Lifetime planning
Clear documentation

You can see the official overview of inheritance tax rules on GOV.UK here.

For couples without children, the key is understanding where the system stops helping automatically, and where you can step in.

The inheritance tax allowances that matter most if you don’t have children

The standard allowance you do get

Everyone has a £325,000 inheritance tax allowance (the nil-rate band). Anything above this is normally taxed at 40%.

If you’re married or in a civil partnership, unused allowance can usually pass to your partner. For many couples, this brings breathing space, but it also means the bigger planning decision is often deferred to your partner, rather than resolved.

The allowance many child-free couples lose

There’s an extra £175,000 residence nil-rate band, but only if your home is left to a direct descendant.

That means:

Children
Stepchildren
Grandchildren

Not:

Nieces or nephews
Siblings
Friends
Godchildren

GOV.UK explains the residence nil-rate band here.

Why this matters in real life

Imagine a couple who:

Own a £700,000 home
Have savings and investments of £300,000
Want their estate split between a surviving partner, a sibling, and two nieces

Without children, a significant portion of the home’s value may be exposed to inheritance tax — unless planning steps are taken in advance.

Start with the basics (this is where many people delay)

1. Make a will, even if it feels too early

If you don’t have children, a will is often the only document that ensures your wishes are followed.

It allows you to:

Protect your partner
Support siblings, nieces, nephews or godchildren
Leave money to friends or charities
Avoid assets passing under intestacy rules

MoneyHelper has a clear guide to getting started.

Example: You and your partner own a home together, but you’re not married. Without a will, your share may pass to relatives, not to the person you live with. A will prevents that uncertainty.

→ Widowed younger than expected? Navigating inheritance, pensions and protection

2. Put lasting powers of attorney in place

If something unexpected happens, who would manage your finances or make decisions for you?

Without children, this often isn’t obvious — and without legal authority, even partners can be left unable to act.

Why this matters

We often see people think LPAs are “for later”. In reality, they’re most valuable before anything goes wrong.

→ Empowering Yourself For Your Future: The Importance Of Lasting Powers Of Attorney (Property And Financial Affairs)

Use lifetime gifting to reduce future inheritance tax

Gifting during your lifetime is one of the most effective ways to reduce inheritance tax — and one that’s often underused.

Your annual gifting allowance

You can give away £3,000 each tax year free from inheritance tax. If unused, one year can be carried forward.

Larger gifts and the seven-year rule

Bigger gifts can also fall outside your estate if you live seven years after making them. If you die sooner, inheritance tax may apply (often at a reduced rate after year three).

This is commonly used to help with:

First-home deposits
Education costs
Long-term family support

Regular gifts from surplus income

If you have more income than you need, you might be able to make regular gifts that are immediately outside your estate, provided they don’t affect your standard of living and you keep clear records.

This can work well if you want to:

Support family members consistently
Fund education costs
Donate regularly to charity

MoneyHelper explains gift exemptions in plain English.

Charitable giving: tax efficiency with purpose

If leaving a legacy is important to you, charity can play a meaningful role in your plan.

Gifts to UK-registered charities are exempt from inheritance tax
If you leave 10% or more of your taxable estate to charity, the inheritance tax rate on the rest can reduce from 40% to 36%

HMRC sets out the reduced rate rules here.

This won’t suit everyone, but for some couples it aligns values with tax efficiency.

Example

You want most of your estate to go to family, but you also care deeply about animal welfare or medical research. Including charity in your will can reduce tax and reflect your values.

Don’t overlook pensions, especially with changes ahead

Pensions have long been used to pass on wealth efficiently, but the landscape is changing.

You can read how pensions are currently taxed on death here.

Important change from April 2027

From April 2027, unused pension funds and many death benefits are expected to be brought into scope for inheritance tax.

What this means in practice

If you were planning to:

Spend other assets first
Leave pensions untouched as a “tax-free pot”

…it’s time to review that assumption

→ New Tax Year, New Opportunities: What You Should Know About Your Pension In 2025/26

If you’re not married, planning matters even more

If you’re not married or in a civil partnership:

There’s no automatic inheritance tax exemption
Assets don’t automatically pass to your partner

This doesn’t mean you’re unprotected, but it does mean documents and structure matter more.

Key steps include:

Clear, up-to-date wills
Understanding how your home is owned
Considering protection through insurance or trusts where appropriate

What a good plan often looks like

For many couples without children, an effective plan includes:

Clear wills and LPAs
Gradual lifetime gifting
Thoughtful pension planning
Optional charitable giving
Regular reviews as life evolves

There’s no single “right” answer, only what’s right for you.

Real-life planning examples

The long-term cohabiting couple

Alex and Sam have been together for 18 years. Long enough to know what works. Long enough to have built something solid.

They own a home together, contribute regularly to their pensions, and live comfortably without feeling the need to formalise their relationship through marriage. What matters most to them is continuity — knowing that if one of them were gone, the other wouldn’t be forced into rushed decisions or financial uncertainty. Beyond that, they want whatever remains to support siblings and nieces in a measured, thoughtful way.

The real risk here is assumption. Without marriage, there’s no automatic inheritance tax exemption between them. The way their property is owned may not reflect their intentions. Their pensions and savings exist, but not yet as a single, joined-up plan.

Planning, in this case, provides protection.

Planning focus

Clear, up-to-date wills naming each other explicitly
Reviewing property ownership (joint tenants vs tenants in common)
Life insurance written in trust to create liquidity for inheritance tax
Gradual lifetime gifting to reduce the taxable estate while supporting family.

The second-marriage couple, no children together

Rachel and David married later in life. They bring with them long careers, established assets, and close relationships with siblings and adult nieces and nephews.

Their first priority is simple: security for the surviving partner. What comes after that needs more thought.

When everything passes automatically to a spouse, the most delicate decisions are often deferred until the second death. By then, there’s no opportunity to explain intentions or balance competing priorities.

Planning brings clarity, here.

Planning focus

Wills that protect the surviving spouse while setting out what happens next
Trust structures where timing or control over inheritance matters
Charitable legacies that reflect shared values and reduce inheritance tax
Reviewing pension death benefits so they align with the long-term plan.

The single professional with godchildren

Priya is 41, owns her flat, and has built a career she’s proud of. She doesn’t want children, but she plays a meaningful role in the lives of her godchildren and wants to support them in practical, thoughtful ways.

There’s no sense of urgency. Life is busy. The future feels distant.

That’s where the vulnerability lies. Without a will, her estate would pass under intestacy rules that don’t reflect her wishes at all. Without early planning, simple opportunities to reduce inheritance tax are missed. Intent exists, but it isn’t yet secured.

Planning turns intention into certainty.

Planning focus

A clear will naming godchildren and any chosen charities
Regular gifts from surplus income to support education or milestones
Consistent use of annual gifting allowances
Reviewing pension beneficiary nominations so nothing is left to assumption.

Here’s where to start

If you don’t have children, it’s easy to assume inheritance planning can wait.

In reality, clarity now gives you more options later, and confidence that your wealth will support the people and causes you care about.

With the right support, you can pass on wealth:

Thoughtfully
Tax-efficiently
In line with the life you’ve lived.

Talk to Finura

At Finura, we help people plan around real lives, not assumptions.

Together, we can make sure your money supports the people and causes that matter to you, not just the system you happen to sit within.

If you’d like to explore how to pass on wealth tax-efficiently and in a way that reflects your values and priorities, we’re here to help.

Book a conversation with Finura

FAQs

Can couples without children pass on wealth tax-free?

Yes — but usually not automatically. While couples without children may miss out on the residence nil-rate band, they can still pass on wealth tax-efficiently by using inheritance tax allowances, lifetime gifting, charitable giving, pension planning, and clear legal documentation such as wills and powers of attorney.

Do you pay more inheritance tax if you don’t have children?

Not necessarily more, but the rules are less generous. Without direct descendants, you may lose access to the £175,000 residence nil-rate band, which can increase the taxable value of your estate unless other planning steps are taken.

Can I leave my house to a niece or nephew tax-free?

Usually not in full. The additional residence allowance only applies when a home is left to direct descendants, not nieces or nephews. However, inheritance tax exposure can often be reduced through lifetime gifting, wills, charitable giving, or insurance planning.

Are unmarried couples treated the same as married couples for inheritance tax?

No. Unmarried couples don’t benefit from the spouse or civil partner inheritance tax exemption, regardless of how long they’ve lived together. This makes wills, property ownership structure, and beneficiary nominations particularly important.

Can I give money away before I die to reduce inheritance tax?

Yes. You can use:

The £3,000 annual gift allowance
Larger gifts under the seven-year rule
Regular gifts from surplus income

When structured correctly, these can significantly reduce inheritance tax over time.

Does leaving money to charity reduce inheritance tax?

Yes. Gifts to UK-registered charities are inheritance-tax exempt. If you leave 10% or more of your taxable estate to charity, the inheritance tax rate on the remainder can reduce from 40% to 36%.

Will pensions still be outside inheritance tax?

Not always. From April 2027, unused pension funds and many death benefits are expected to fall within the scope of inheritance tax. Reviewing pension beneficiaries and wider estate planning is increasingly important.

Key sources

This article draws on guidance and reporting from the following:

The Sunday Times – We don’t have kids, but we still want to give away our cash tax-free
GOV.UK – Inheritance tax: an overview
GOV.UK – Inheritance tax: gifts and the seven-year rule
GOV.UK – Inheritance tax residence nil-rate band
MoneyHelper – A guide to inheritance tax
MoneyHelper – Planning what to leave in your will
MoneyHelper – Gifts and exemptions from inheritance tax
HMRC – Reduced inheritance tax rate for gifts to charity
GOV.UK – Tax on pensions inherited after death
HMRC / GOV.UK – Inheritance tax on unused pension funds and death benefits (from April 2027)

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