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TaxRobin
TaxRobin, Tax Consultant
Category: Tax
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Experience:  International tax
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Where does a deceased individual who lived and worked in

Resolved Question:

Where does a deceased individual who lived and worked in Africa and the USA for some years, and latterly Eire for three years, returning to the US to care for his ill wife approximately 3 years ago, and who sadly died in the US in February this year, stand with regards ***** ***** on his UK estate please?.
(His US estate is being dealt with in the US).He was never nationalized and never owned a property in the USA or Eire.He owned half a flat in Bournemouth UK with his brother owning the other half, which was left to them by their father approximately 8 years ago, plus stocks and shares etc.He was a British Citizen and the UK was where he intended to retire (having looked after his wife in the USA who has been too ill to travel for some years (and is now permanently in a home since his death). He returned to the UK usually once a year, latterly less.Will there be any foreign tax payable on the UK estate as a result of his death? and would tax be deducted here at the full UK rateThank you in advance for your assistance.
Submitted: 1 year ago.
Category: Tax
Expert:  TaxRobin replied 1 year ago.

Hello

There’s normally no Inheritance Tax to pay if:

  • the value of the estate is below the £325,000 threshold
  • they leave everything to their spouse

Funds from the estate is used to pay Inheritance Tax to HM Revenue and Customs (HMRC). This is done by the person controlling the estate (executor).

There usually is tax if the estate’s worth more than £325,000.

The executor has 1 year from the date of death to fill in Inheritance Tax forms if there’s Inheritance Tax to pay.

When there’s Inheritance Tax to pay, it’s usually charged at 40% on the value of the estate above the threshold (£325,000).

If the person who died inherited something from another person’s estate in the 5 years before they died, they can claim Successive Charges Relief. The house inherited 8 years ago does not meet this.

Customer: replied 1 year ago.
The UK estate was not left to his spouse, she inherits the US estate.
The UK estate was left to family and friends. Does the deceased UK estate not get any tax relief from the fact that he was out of the country for all but 1 or 2 weeks a year?
Is the UK estate liable to US tax laws?
Expert:  TaxRobin replied 1 year ago.

The UK estate is not liable to US tax.

Individuals who are not domiciled in the U.S. can be subject to U.S. estate tax. However, their estates are subject to estate tax on specific U.S. assets only, not worldwide assets.

Even if a person is an ex***** *****ving outside of the UK, they will still be subject to inheritance tax in the UK if they are deemed to be of a UK domicile status.

If they've got a non-domicile status in the UK, only UK based assets will be liable to inheritance tax in the UK.

TaxRobin and 2 other Tax Specialists are ready to help you
Customer: replied 1 year ago.
Thank you. I think I have got these facts sorted now. Thank you for your help again.
Expert:  TaxRobin replied 1 year ago.

You are most welcome.

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