Foreign inheritance

spaggy

I have a question re inheritance tax

We are due to inherit from a foreign property sale. We propose to leave the money in a foreign bank account initially.

Will we have to pay any UK inheritance tax at all??

Thanks

Cook_County

You may owe CGT if you make a currency gain. You will not owe UK IHT.

G_M

Cook_County wrote: »

You may owe CGT if you make a currency gain. You will not owe UK IHT.

Sorry that is a very misleading answer. It depends on unknown factors:

UK resident or not?
Which country? EU or not?
Was there a will or not?
Was it a UK will or overseas will, or both?

If the property is in France, for instance, then you are probobly OK (the estate is subject to French inheritance tax, the beneficiary not taxed at all), but the same is not true for all countries/situations.

spaggy

G_M wrote: »

Sorry that is a very misleading answer. It depends on unknown factors:

UK resident or not? yes
Which country? EU or not? Jordan
Was there a will or not? property in family, going to be sold and funds distributed
Was it a UK will or overseas will, or both?

If the property is in France, for instance, then you are probobly OK (the estate is subject to French inheritance tax, the beneficiary not taxed at all), but the same is not true for all countries/situations.

Thanks

Spaggy

cheerfulcat

G_M wrote: »

Sorry that is a very misleading answer. It depends on unknown factors:

UK resident or not?
Which country? EU or not?
Was there a will or not?
Was it a UK will or overseas will, or both?

If the property is in France, for instance, then you are probobly OK (the estate is subject to French inheritance tax, the beneficiary not taxed at all), but the same is not true for all countries/situations.

Out of interest - under which circumstances is a beneficiary liable for UK inheritance tax? Thought that was only levied on estates? Genuine question.

G_M

cheerfulcat wrote: »

Out of interest - under which circumstances is a beneficiary liable for UK inheritance tax? Thought that was only levied on estates? Genuine question.

I don't pretend to be an expert in this field - just did some googling and came up with:

"Where assets are taxed in both countries, under the UK/France inheritance tax treaty, tax should be paid in the country where the property is located, and you can offset this against the tax due in the country of residence to avoid double taxation, even though the UK taxes the estate and the French tax the recipient."

Having looked at this again, I now realise I was wrong. It appears in this scenario the beneficiary (recipient) would pay French IT, the estate would not pay anything. I think!

Although not an expert, I do know, however, that this is a much more complex issue than is implied by CookCounty's bald statement that "You may owe CGT if you make a currency gain. You will not owe UK IHT. "

Take a look at the HMRC site for a flavour of the complexity. See here.

cheerfulcat

Thanks, G_M.