Lostlily Posted August 27, 2016 Share Posted August 27, 2016 Hi everyone, I am hoping that someone can help me here. I am usually pretty savvy on financial issues, but am stuck on this one. My husband and I have been living in Australia for 18 years. We have dual UK/Aus Citizenship. As we are getting on a bit, we are wondering about inheritance tax for people included in our will in the UK. I know there is no IHT in Australia, but on reading up on this recently, CGT seems to almost be a replacement for it? But my main query is in regard to portions of our estate left to people in the UK. Will they be liable to UK IHT or CGT. We have some family here, one daughter who will be the executor of our will and I don't want to leave her with a lot of unnecessary red tape. We dd think of buying a small property in the UK for holidays etc, but it got so very complicated as then we would be domiciled back in the UK for tax purposes. Any help or advice would be appreciated. Thank You. Link to comment Share on other sites More sharing options...
Parley Posted August 27, 2016 Share Posted August 27, 2016 Are all your assets in Australia ? If so and your will is made here I don't believe there will be inheritance tax issues for people in the UK. It is the estate that is taxed after all not the recipients. Link to comment Share on other sites More sharing options...
Bungo Posted August 27, 2016 Share Posted August 27, 2016 Hi everyone,I am hoping that someone can help me here. I am usually pretty savvy on financial issues, but am stuck on this one. My husband and I have been living in Australia for 18 years. We have dual UK/Aus Citizenship. As we are getting on a bit, we are wondering about inheritance tax for people included in our will in the UK. I know there is no IHT in Australia, but on reading up on this recently, CGT seems to almost be a replacement for it? But my main query is in regard to portions of our estate left to people in the UK. Will they be liable to UK IHT or CGT. We have some family here, one daughter who will be the executor of our will and I don't want to leave her with a lot of unnecessary red tape. We dd think of buying a small property in the UK for holidays etc, but it got so very complicated as then we would be domiciled back in the UK for tax purposes. Any help or advice would be appreciated. Thank You. It is the estate that is taxed not the recipients. So if you are Australian domiciled then indeed there are no UK tax consequences whatsoever. Link to comment Share on other sites More sharing options...
Lostlily Posted August 27, 2016 Author Share Posted August 27, 2016 Thank you both for your encouraging answers, do either of you guys have any link so I can confirm this information? Link to comment Share on other sites More sharing options...
Bungo Posted August 27, 2016 Share Posted August 27, 2016 Thank you both for your encouraging answers, do either of you guys have any link so I can confirm this information? Google HMRC and inheritance tax and you can read all about it. Link to comment Share on other sites More sharing options...
Lostlily Posted August 27, 2016 Author Share Posted August 27, 2016 Thank you will do Link to comment Share on other sites More sharing options...
Lostlily Posted August 27, 2016 Author Share Posted August 27, 2016 Thanks for your help, but as far as I can work out, this site really only relates to the UK. I have been going round and round in circles trying to establish the legal requirements of beneficiaries in the UK from Australia. I have never been very happy consulting "tax experts" unless I understand the rules myself. It seems very unclear to me...... Link to comment Share on other sites More sharing options...
Parley Posted August 27, 2016 Share Posted August 27, 2016 If you won't believe the advice of others then it is probably best for you to keep searching yourself. Link to comment Share on other sites More sharing options...
Guest Posted August 27, 2016 Share Posted August 27, 2016 Thanks for your help, but as far as I can work out, this site really only relates to the UK. I have been going round and round in circles trying to establish the legal requirements of beneficiaries in the UK from Australia.I have never been very happy consulting "tax experts" unless I understand the rules myself. It seems very unclear to me...... But if you don't understand the rules, then consulting a professional who does makes sense surely? Link to comment Share on other sites More sharing options...
NicF Posted August 27, 2016 Share Posted August 27, 2016 https://www.gov.uk/inheritance-tax/when-someone-living-outside-the-uk-dies Have a read of this - it all seems pretty clear to me. You need to think in terms of the person being taxed in inheritance tax is the person that dies and not the person that inherits the estate. Link to comment Share on other sites More sharing options...
Bungo Posted August 27, 2016 Share Posted August 27, 2016 Thanks for your help, but as far as I can work out, this site really only relates to the UK. I have been going round and round in circles trying to establish the legal requirements of beneficiaries in the UK from Australia.I have never been very happy consulting "tax experts" unless I understand the rules myself. It seems very unclear to me...... If you google as I suggest, and read the HMRC pages, it is crystal clear. HMRC produces remarkably easy to read and clear guidance, remarkable for such an otherwise incompetent body. If you do not want to believe what you have been told and what is written in black amd white on the HMRC website, then please go and pay an accountant to tell you the same. Link to comment Share on other sites More sharing options...
Parley Posted August 27, 2016 Share Posted August 27, 2016 If all her assets are in Australia and will done in Australia and probate obtained here then UK is irrelevant. The executor or solicitor in Aus just send the recipients in the UK their loot. I did ask the OP to confirm this but she hasn't done so. Link to comment Share on other sites More sharing options...
Bungo Posted August 28, 2016 Share Posted August 28, 2016 If all her assets are in Australia and will done in Australia and probate obtained here then UK is irrelevant.The executor or solicitor in Aus just send the recipients in the UK their loot. I did ask the OP to confirm this but she hasn't done so. It is indeed irrelevant and reading HMRC website would easily confirm this. On the first page I believe.. Link to comment Share on other sites More sharing options...
Lostlily Posted August 28, 2016 Author Share Posted August 28, 2016 Yes all of our assets are in Australia, the executor is in Australia, but several beneficiaries are in the UK. Everyone has been helpful, I have read the links. My confusion arises from previous information. A couple of years ago, we considered buying a modest property in the UK to use for part of the year, but in the end we backed out because we were told by our old accountant there and from our own research that if you are from the UK, spend more than 3 months a year there and/or have a rental or purchased property available for your use you will be considered domiciled in the UK. Then all of your worldwide assets are treated as taxable in the UK. The other thing is that although tree is no IHT in Australia, assuming we were still domiciled here. Apart from certain exclusions CGT appears to be payable when the assets are sold, so I assume that this is deducted from the estate before money is divided up? Link to comment Share on other sites More sharing options...
Parley Posted August 28, 2016 Share Posted August 28, 2016 Are you referring to your own home ? That is CGT free. If you have investment properties you should probably discuss with an Accountant or Estates solicitor. CGT can be an issue in some cases. If it is your own home then there is no issue. Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.