Family member refuses to complete IHT403

hullensien

poseidon1 said:

I feel I should introduced the issue of whether or not the father was really UK domiciled for IHT purposes at the time he made the overseas gifts, bearing in mind he appears to have been abroad as far back as 2008 ( if not earlier).

The fact the father was made ro return 'involuntarily' to the UK where he eventually died, does not affect whether he had excercised a firm  and irrevocable decision to change his UK tax domicile of origin (at birth) to a new foreign domicile of choice (France), if when originally moving to France he had no intention of ever returning to the UK. Please note given up his UK passport is not a conditional requirement to changing ones tax domicile.

The concept of tax 'domicile' in this regard has a precise meaning for legal purposes, unconnected to its ordinary english language definition, and therefore unlikely something you or your partner will be familiar with when making submissions to HMRC.

The  blog below  gives a reasonable outline of how  a UK domiciled person can go about changing their UK domicile, and despite its rather jocular tone has the advantage of being reasonably approachable for someone not versed in tax law

https://taxscouts.com/the-tax-basics/how-does-domicile-of-choice-work/


Having regard to the above, if the  father's  actions subsequent to his original departure abroad meets the criteria of someone with a firm intention to give up his UK domicile of origin ( for tax purposes), in favour of a French domicile of choice,  I would certainly try to contend all gifts of chattels he made while living abroad, were outside the scope of UK IHT on death, because he was not UK tax domiciled ( for IHT purposes) at the time the gifts occurred. 

Those gifts may or may not have foreign gift/wealth tax implications at the time they were made, but that is certainly not something that concerns your partner at the moment 

This is a very archane and complex area of tax law and practice, outside the experience and competency of the average solicitor. 

If your partner wants to explore how best to make submissions to HMRC  on this basis she will need to consult a STEP qualified solicitor with specific competency in non dom, cross border tax planning matters.
I would add that the Labour government has implemented changes to the domicile and residence tax rules in April, effective for deaths occuring after 5 April 2025, so this may introduce further complexity. 

Nonetheless I suspect if a legal adviser can make a convinving case that  the overseas gifts fall out of the scope  of UK IHT , your partner's  task will be made immeasurably easier.

Hi
Thanks for the response. he suffered badly with COVID - had it 5 times - in the end couldn’t look after himself so went in a french care home - unfortunately didnt speak french so was isolated for over 2 years - he wanted to come back to the UK and his legally appointed french guardian said he was competent enough to make his own choices so it was a voluntary return.
The problem is we don’t know fully the extent of the “gifting” therefore couldn’t accurately complete the IHT403 - we can’t even make a best guess because we don’t know the models of the watches or the shotguns, and are not 100% on the cars. The recipients of the gifts will not give us any info.
We just don’t wan’t to fall foul of the HMRC
thanks again

poseidon1

Fair point on the unfortunate events leading up to his return to the UK, but what  of his original departure, is there any evidence that his original intention was for the  move to be a permanent one? 

Did he disposed of his UK home ( so no UK real estate), did he cease being subject to UK tax ( other than any deductions at source on occupational pensions), was he a French tax payer for the entire period prior to return to UK, is there any evidence that but for covid he may have made arrangements to be buried in France? 

These are just a few factors that might point to an original intent that may have been subsequently  derailed by the outbreak of covid. Of course he is no longer around to answer these questions himself, but surely your partner has some awareness on these questions?

If non UK dom status cannot be adduced for the relevant period of the gifts, your partner's options with regard to accruate IHT reporting  on behalf of the deceased is servely hampered by the intransigent siblings, as advised by the other posters here.

hullensien

poseidon1 said:

I feel I should introduced the issue of whether or not the father was really UK domiciled for IHT purposes at the time he made the overseas gifts, bearing in mind he appears to have been abroad as far back as 2008 ( if not earlier).

The fact the father was made ro return 'involuntarily' to the UK where he eventually died, does not affect whether he had excercised a firm  and irrevocable decision to change his UK tax domicile of origin (at birth) to a new foreign domicile of choice (France), if when originally moving to France he had no intention of ever returning to the UK. Please note given up his UK passport is not a conditional requirement to changing ones tax domicile.

The concept of tax 'domicile' in this regard has a precise meaning for legal purposes, unconnected to its ordinary english language definition, and therefore unlikely something you or your partner will be familiar with when making submissions to HMRC.

The  blog below  gives a reasonable outline of how  a UK domiciled person can go about changing their UK domicile, and despite its rather jocular tone has the advantage of being reasonably approachable for someone not versed in tax law

https://taxscouts.com/the-tax-basics/how-does-domicile-of-choice-work/


Having regard to the above, if the  father's  actions subsequent to his original departure abroad meets the criteria of someone with a firm intention to give up his UK domicile of origin ( for tax purposes), in favour of a French domicile of choice,  I would certainly try to contend all gifts of chattels he made while living abroad, were outside the scope of UK IHT on death, because he was not UK tax domiciled ( for IHT purposes) at the time the gifts occurred. 

Those gifts may or may not have foreign gift/wealth tax implications at the time they were made, but that is certainly not something that concerns your partner at the moment 

This is a very archane and complex area of tax law and practice, outside the experience and competency of the average solicitor. 

If your partner wants to explore how best to make submissions to HMRC  on this basis she will need to consult a STEP qualified solicitor with specific competency in non dom, cross border tax planning matters.
I would add that the Labour government has implemented changes to the domicile and residence tax rules in April, effective for deaths occuring after 5 April 2025, so this may introduce further complexity. 

Nonetheless I suspect if a legal adviser can make a convinving case that  the overseas gifts fall out of the scope  of UK IHT , your partner's  task will be made immeasurably easier.

he voluntarily came back - went travelling in 2003 - fell in love with the place and bought a small property - got divorced in 2008 - she came back - he stayed there - didnt have enough for it to be deemed as “tax purposes”
he got hit with covid 5 times and couldnt cope so he went in to a french care home with very few english speakers so he was feeling isolated. He was put under a court appointed guardian after the care home discovered some irregularities with his finances. He wanted to come back to live with one of his daughters (my partner) and the guardian deemed him competent enough to make his own decisions, so the judge released him from the guardianship and he returned to the UK
We have no ideas as to what to put on the IHT403 - we dont know the models of the watches, the shotguns, or the classic cars so we cant even hazard a guess - we just dont want to fall foul of the HMRC

poseidon1

hullensien said:

poseidon1 said:

I feel I should introduced the issue of whether or not the father was really UK domiciled for IHT purposes at the time he made the overseas gifts, bearing in mind he appears to have been abroad as far back as 2008 ( if not earlier).

The fact the father was made ro return 'involuntarily' to the UK where he eventually died, does not affect whether he had excercised a firm  and irrevocable decision to change his UK tax domicile of origin (at birth) to a new foreign domicile of choice (France), if when originally moving to France he had no intention of ever returning to the UK. Please note given up his UK passport is not a conditional requirement to changing ones tax domicile.

The concept of tax 'domicile' in this regard has a precise meaning for legal purposes, unconnected to its ordinary english language definition, and therefore unlikely something you or your partner will be familiar with when making submissions to HMRC.

The  blog below  gives a reasonable outline of how  a UK domiciled person can go about changing their UK domicile, and despite its rather jocular tone has the advantage of being reasonably approachable for someone not versed in tax law

https://taxscouts.com/the-tax-basics/how-does-domicile-of-choice-work/


Having regard to the above, if the  father's  actions subsequent to his original departure abroad meets the criteria of someone with a firm intention to give up his UK domicile of origin ( for tax purposes), in favour of a French domicile of choice,  I would certainly try to contend all gifts of chattels he made while living abroad, were outside the scope of UK IHT on death, because he was not UK tax domiciled ( for IHT purposes) at the time the gifts occurred. 

Those gifts may or may not have foreign gift/wealth tax implications at the time they were made, but that is certainly not something that concerns your partner at the moment 

This is a very archane and complex area of tax law and practice, outside the experience and competency of the average solicitor. 

If your partner wants to explore how best to make submissions to HMRC  on this basis she will need to consult a STEP qualified solicitor with specific competency in non dom, cross border tax planning matters.
I would add that the Labour government has implemented changes to the domicile and residence tax rules in April, effective for deaths occuring after 5 April 2025, so this may introduce further complexity. 

Nonetheless I suspect if a legal adviser can make a convinving case that  the overseas gifts fall out of the scope  of UK IHT , your partner's  task will be made immeasurably easier.

he voluntarily came back - went travelling in 2003 - fell in love with the place and bought a small property - got divorced in 2008 - she came back - he stayed there - didnt have enough for it to be deemed as “tax purposes”
he got hit with covid 5 times and couldnt cope so he went in to a french care home with very few english speakers so he was feeling isolated. He was put under a court appointed guardian after the care home discovered some irregularities with his finances. He wanted to come back to live with one of his daughters (my partner) and the guardian deemed him competent enough to make his own decisions, so the judge released him from the guardianship and he returned to the UK
We have no ideas as to what to put on the IHT403 - we dont know the models of the watches, the shotguns, or the classic cars so we cant even hazard a guess - we just dont want to fall foul of the HMRC

If this was a matter I was handling on behalf of a client, I would hold off trying to lodge the IHT 400, write to HMRC setting out the facts as you have relayed to forum, and seek an inspector's guidance and direction as to the best approach for your partner to comply with her reporting duties,  as best she can. 

Certainly, luxury watches, classic cars even shotguns ( Purdeys as an example) can come with very hefty price tags, not to mention the appropriate specialist advice able to ascertain the relevant values. 

hullensien

poseidon1 said:

hullensien said:

poseidon1 said:

I feel I should introduced the issue of whether or not the father was really UK domiciled for IHT purposes at the time he made the overseas gifts, bearing in mind he appears to have been abroad as far back as 2008 ( if not earlier).

The fact the father was made ro return 'involuntarily' to the UK where he eventually died, does not affect whether he had excercised a firm  and irrevocable decision to change his UK tax domicile of origin (at birth) to a new foreign domicile of choice (France), if when originally moving to France he had no intention of ever returning to the UK. Please note given up his UK passport is not a conditional requirement to changing ones tax domicile.

The concept of tax 'domicile' in this regard has a precise meaning for legal purposes, unconnected to its ordinary english language definition, and therefore unlikely something you or your partner will be familiar with when making submissions to HMRC.

The  blog below  gives a reasonable outline of how  a UK domiciled person can go about changing their UK domicile, and despite its rather jocular tone has the advantage of being reasonably approachable for someone not versed in tax law

https://taxscouts.com/the-tax-basics/how-does-domicile-of-choice-work/


Having regard to the above, if the  father's  actions subsequent to his original departure abroad meets the criteria of someone with a firm intention to give up his UK domicile of origin ( for tax purposes), in favour of a French domicile of choice,  I would certainly try to contend all gifts of chattels he made while living abroad, were outside the scope of UK IHT on death, because he was not UK tax domiciled ( for IHT purposes) at the time the gifts occurred. 

Those gifts may or may not have foreign gift/wealth tax implications at the time they were made, but that is certainly not something that concerns your partner at the moment 

This is a very archane and complex area of tax law and practice, outside the experience and competency of the average solicitor. 

If your partner wants to explore how best to make submissions to HMRC  on this basis she will need to consult a STEP qualified solicitor with specific competency in non dom, cross border tax planning matters.
I would add that the Labour government has implemented changes to the domicile and residence tax rules in April, effective for deaths occuring after 5 April 2025, so this may introduce further complexity. 

Nonetheless I suspect if a legal adviser can make a convinving case that  the overseas gifts fall out of the scope  of UK IHT , your partner's  task will be made immeasurably easier.

he voluntarily came back - went travelling in 2003 - fell in love with the place and bought a small property - got divorced in 2008 - she came back - he stayed there - didnt have enough for it to be deemed as “tax purposes”
he got hit with covid 5 times and couldnt cope so he went in to a french care home with very few english speakers so he was feeling isolated. He was put under a court appointed guardian after the care home discovered some irregularities with his finances. He wanted to come back to live with one of his daughters (my partner) and the guardian deemed him competent enough to make his own decisions, so the judge released him from the guardianship and he returned to the UK
We have no ideas as to what to put on the IHT403 - we dont know the models of the watches, the shotguns, or the classic cars so we cant even hazard a guess - we just dont want to fall foul of the HMRC

If this was a matter I was handling on behalf of a client, I would hold off trying to lodge the IHT 400, write to HMRC setting out the facts as you have relayed to forum, and seek an inspector's guidance and direction as to the best approach for your partner to comply with her reporting duties,  as best she can. 

Certainly, luxury watches, classic cars even shotguns ( Purdeys as an example) can come with very hefty price tags, not to mention the appropriate specialist advice able to ascertain the relevant values. 

I thought that was our best option - we will write to the HMRC  - we will give full transparency - if the other siblings don’t then hopefully the HMRC will give us some guidance or perhaps they might get involved with the siblings
thanks again

Marcon

hullensien said:

poseidon1 said:

hullensien said:

poseidon1 said:

I feel I should introduced the issue of whether or not the father was really UK domiciled for IHT purposes at the time he made the overseas gifts, bearing in mind he appears to have been abroad as far back as 2008 ( if not earlier).

The fact the father was made ro return 'involuntarily' to the UK where he eventually died, does not affect whether he had excercised a firm  and irrevocable decision to change his UK tax domicile of origin (at birth) to a new foreign domicile of choice (France), if when originally moving to France he had no intention of ever returning to the UK. Please note given up his UK passport is not a conditional requirement to changing ones tax domicile.

The concept of tax 'domicile' in this regard has a precise meaning for legal purposes, unconnected to its ordinary english language definition, and therefore unlikely something you or your partner will be familiar with when making submissions to HMRC.

The  blog below  gives a reasonable outline of how  a UK domiciled person can go about changing their UK domicile, and despite its rather jocular tone has the advantage of being reasonably approachable for someone not versed in tax law

https://taxscouts.com/the-tax-basics/how-does-domicile-of-choice-work/


Having regard to the above, if the  father's  actions subsequent to his original departure abroad meets the criteria of someone with a firm intention to give up his UK domicile of origin ( for tax purposes), in favour of a French domicile of choice,  I would certainly try to contend all gifts of chattels he made while living abroad, were outside the scope of UK IHT on death, because he was not UK tax domiciled ( for IHT purposes) at the time the gifts occurred. 

Those gifts may or may not have foreign gift/wealth tax implications at the time they were made, but that is certainly not something that concerns your partner at the moment 

This is a very archane and complex area of tax law and practice, outside the experience and competency of the average solicitor. 

If your partner wants to explore how best to make submissions to HMRC  on this basis she will need to consult a STEP qualified solicitor with specific competency in non dom, cross border tax planning matters.
I would add that the Labour government has implemented changes to the domicile and residence tax rules in April, effective for deaths occuring after 5 April 2025, so this may introduce further complexity. 

Nonetheless I suspect if a legal adviser can make a convinving case that  the overseas gifts fall out of the scope  of UK IHT , your partner's  task will be made immeasurably easier.

he voluntarily came back - went travelling in 2003 - fell in love with the place and bought a small property - got divorced in 2008 - she came back - he stayed there - didnt have enough for it to be deemed as “tax purposes”
he got hit with covid 5 times and couldnt cope so he went in to a french care home with very few english speakers so he was feeling isolated. He was put under a court appointed guardian after the care home discovered some irregularities with his finances. He wanted to come back to live with one of his daughters (my partner) and the guardian deemed him competent enough to make his own decisions, so the judge released him from the guardianship and he returned to the UK
We have no ideas as to what to put on the IHT403 - we dont know the models of the watches, the shotguns, or the classic cars so we cant even hazard a guess - we just dont want to fall foul of the HMRC

If this was a matter I was handling on behalf of a client, I would hold off trying to lodge the IHT 400, write to HMRC setting out the facts as you have relayed to forum, and seek an inspector's guidance and direction as to the best approach for your partner to comply with her reporting duties,  as best she can. 

Certainly, luxury watches, classic cars even shotguns ( Purdeys as an example) can come with very hefty price tags, not to mention the appropriate specialist advice able to ascertain the relevant values. 

I thought that was our best option - we will write to the HMRC  - we will give full transparency - if the other siblings don’t then hopefully the HMRC will give us some guidance or perhaps they might get involved with the siblings
thanks again

You are really in a truly horrible position through no fault of your own. The wording of the letter to HMRC could be very important in terms of what happens next.  You might think about getting some advice from a solicitor before going any further - a site like this is going to be very limited in what it can offer (except sympathy) in such a complex situation.