An inheritance tax (IHT) concept that the government proposed in a June 2014 consultation for inclusion in the Finance Bill 2015, but dropped in the Autumn Statement on 3 December 2014.

It was to have been an amount on which IHT was charged at 0% for the purpose of calculating ten-year anniversary and exit charges in relevant property trusts created by individual settlors.

It would have been separate from, and in addition to, the settlor's personal nil rate band, which would have continued to apply for the purpose of calculating IHT charges on gifts to trusts that were chargeable transfers in the settlor's lifetime or on death. The value of the settlement nil rate band was to have been the same as the value of the personal nil rate band (see Practice note, Tax data: inheritance tax: Nil rate band). Each individual would have had one settlement nil rate band during his lifetime (unlike the personal nil rate band, it would not have been renewed every seven years).

For more information, including about new proposals to prevent the use of multiple trusts to avoid IHT, see Practice note, Inheritance tax: relevant property trusts: changes to rules: 2014 Autumn Statement drops settlement nil rate band and Settlement nil rate band (as proposed in 2014 consultation).