The inheritance tax (IHT) nil rate band will increase by 1% in 2015-16 to £329,000, the government has announced.
The IHT nil rate band has been frozen since 2009 at £325,000. The government said the measure would raise an extra £35 million by 2017-18.
The threshold was frozen in the 2010 Budget until 2014-15. If the estate is more than the threshold, IHT is charged at 40% on the amount over the nil rate band.
From April 2012 anyone who leaves over 10% of their estate to charity can choose to pay a reduced rate of 36%.