Inheritance Tax Manual

IHTM27200 - Foreign property: Double Taxation: procedure when both forms of relief apply

From 6 April 2025, for inheritance tax purposes domicile is replaced by long-term UK residence and you can find details of these rules at IHTM47000.Ìý

Unilateral relief and relief under a double taxation convention are not mutually exclusive. Where both reliefs would appear to be due on the same item of property, relief is restricted by IHTA84/S159 (7) to whichever is the greater. In practice, where the amount of credit is the same under either, the credit should be treated as convention relief.Ìý

Unilateral relief may be given for a바카라 사이트¯regional바카라 사이트¯tax바카라 사이트¯(e.g. US State/Swiss Canton)바카라 사이트¯as well as unilateral or convention relief in respect of tax due in the country where the region is located.Ìý

ExampleÌý

Giles, a British citizen, dies when he was domiciled in the UKÌý(before 6 April 2025)Ìýor was a long-term UK residentÌý(after 6 April 2025). His estate includes an apartment in New York, stocks and shares in US Companies and a New York bank account.Ìý

The world-wide estate will be subject to UK tax, but US Federal Estate Tax will (because of the terms of the double taxation convention) be payable only on the immovable property in the USA. The UK will ÌýconsiderÌýaÌýcredit for the US Federal Estate tax under the convention.Ìý

New York State will also charge State Estate Tax on the movable assets situated there and the UK will ÌýconsiderÌýunilateral relief for this taxÌýas it is not covered by the terms of the Convention.Ìý

But the total unilateral and convention credit cannot exceed the amount of UK Inheritance tax payable on the property concerned.