Up until 6 April 2025 UK inheritance tax (IHT) was based on the deceased’s domicile (broadly meaning the country that is an individual’s permanent home or where they intend to return to indefinitely); on the death of a UK-domiciled (or deemed domiciled) individual, that person’s entire estate (irrespective of the situs of such assets) was within the charge to UK IHT. For non-UK-domiciled individuals, only UK-situs assets were within the charge to UK IHT. UK IHT is charged at a rate of 40% on estates valued at more than £325,000, or £500,000 if the deceased’s home is left to their direct descendant(s), such as children or grandchildren; no change to the UK IHT rate is expected as part of the IHT reforms being implemented in the UK.
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