Offshore Structures, Inheritance Tax, and the “sting in the tail”
18 October 2022
Historically, non-UK domiciled individuals would often choose to hold UK real estate through an offshore company (which may, in turn, have been held by offshore trustees) in order to avoid a charge to UK inheritance tax (“IHT”) on that real estate.
The shares in such an offshore company were non-UK situs assets for the purposes of UK IHT and were therefore classified as ‘excluded property’ in the hands of the non-UK domiciled individual or trustees. There was no look-through to the underlying UK real estate.
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