UK Inheritance Tax (IHT)

My wife and me own and live in a property (e.g. it is our Principal Private Residence - PPR) worth £1,000,000 We also own two rental properties worth £400,000 in total. I understand that if our PPR is left to our children after we both die the £1,000,000 does not attract IHT but our rental properties will. If I take a Lifetime Mortgage of £100,000 secured against our PPR, will the £100,00 reduce the value of my PPR for IHT purposes to £900,000 (thereby losing £100,000 of our PPR allowance) or is the £100,000 taken off the total value of the estate?

e.g.

Value of PPR £1,000,000 Less Lifetime Mortgage £100,000 Net value of PPR. £900,000 Net estate subject to IHT. £400,000

Value of the estate. £1,400,000 Less Lifetime Mortgage. £100,000 Less PPR allowance. £1,000,000 Net estate subject to IHT. £300,000

Many thanks!