Expatriates continue to be subject to UK inheritance tax unless they successfully lose their domicile in favour of a new one, says Brendan Harper, technical services manager at Friends Provident International. But how can this be proved?
The English common law definition of domicile is quite unique in the world in that a person's domicile of origin can stay with him long after he has ceased to live in that country. If you are unfortunate enough to have a UK domicile of origin, this means that you could live outside the UK for many years and yet the UK taxman remains as a potential beneficiary of up to 40% of your estate. And it is not just on death that the charge can bite. Following changes to the inheritance tax (IHT) rules in 2006, if money is settled into trust, there could be an immediate charge to IHT at 20% of the ...
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