This information is specifically formulated for UK expats or for individuals with UK assets. If you would like advice for any other nationality please contact us and we will get a specialist advisor to get in touch. 

What is Inheritance Tax?

Inheritance tax is a levy on the total value of lifetime gifts and assets (including the main residence) passing between owners on death.

Cumulative transfers are taxed at 40% on death, although the first £325,000 is free from inheritance tax.

From April 2012, a reduced inheritance tax rate of 36% was introduced where 10% or more of the estate is left to charity.

Since October 2007, UK domiciled and deemed domiciled spouses and civil partners have been able to transfer their unused nil-rate-band allowances, in effect doubling the amount that can be passed on tax free.

Any part of the nil-rate band not used when the first spouse or civil partner died can be transferred to the individual’s surviving spouse or civil partner for use on their death. This change was applied retrospectively for any living widow or widower.

Why is it so complicated?

UK Inheritance Tax has been developed and tweaked by successive governments to add in allowances, limits, and adjustments.

To add to this there are an equally complicated number of ways to legally minimise your tax bill by structuring your estate properly. Speak to one of our UK tax experts today who can help guide you through this process.

Further Resources