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Residence-based IHT system from 6 April 2025


Produced by a Tolley Trusts and Inheritance Tax expert
Trusts and Inheritance Tax
Guidance
tag-icon Autumn Budget 2024

Residence-based IHT system from 6 April 2025


Produced by a Tolley Trusts and Inheritance Tax expert
Trusts and Inheritance Tax
Guidance
tag-icon Autumn Budget 2024
imgtext

This guidance note details the changes to the IHT system in the UK from a domicile based system prior to 6 April 2025 and a residence-based IHT system for events on and after this date.

Current position

The current position is as set out in the Domicile for UK inheritance tax guidance note.

New rules

The new rules will apply from 6 April 2025 and draft legislation has been released. As would be expected for such a fundamental change, this is a very long piece of draft legislation at 103 pages. HMRC have also published Technical Note: Reforming the taxation of non-UK domiciled individuals which contains useful detail and case studies.

In addition, the remittance basis of taxation will be abolished and replaced with a time-limited foreign income and gains (FIG) regime. See the Abolition of the remittance basis from 2025/26 guidance note for further details.

Domicile will still exist as a common law concept but will have no impact on the inheritance tax position.

Long term residence

From

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  • 01 Nov 2024 14:31

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