Obtain the latest information on tax planning for property, buy to lets, working overseas, non-resident and offshore tax and much more - see site for more info now!Obtain the latest information on tax planning for property, buy to lets, working overseas, non-resident and offshore tax and much more - see site for more info now!
HomeFree Tax HelpBusiness Tax BooksIHT BooksNon Dom BooksNon Residence BooksProperty Tax BooksOffshore Company/Trust BooksSearchMember Area
Join Now
 most popular
Free Tax Books
Ask A Tax Question
Latest Q&A's
Latest Articles
Latest Tax Calculators
 Tax Help
Free Tax Help
Free Tax Return Help
Latest Tax Q&A's
Gold Members Resources
 Tax Planning
Capital Gains Tax
Corporation Tax
Income Tax
Inheritance Tax
Stamp Duty
Entrepreneurs Relief Tool
Non Residence Tool 2013+
Online Domicile Test
Remittance Basis Calc
Offshore Trust Tax Tool
Interactive PPR Relief Tool
Family Home - IHT Tool
Non Resident CGT Tool
Choose Offshore Co. Tool
Offshore Co. Tax Tool
 Non UK Domicile Tax Planning
Non UK Domiciliaries
Non Dom Tax Q&A's
 Non Resident Tax Planning
Non UK Residents
Non-Resident Tax Book
Non Resident Tax Q&A's
Statutory Residence Test
 Company Tax Planning
Corporation Tax Articles
Corporation Tax Q&A's
Company Tax Calculators
 Tax Planning Questions and Answers
Capital Gains Tax Q&A
Corporation Tax Q&A
Income Tax Q&A
Non Domicile Tax Q&A
Non Resident Tax Q&A
Inheritance Tax Q&A
 Tax Planning With Offshore Companies
Offshore Companies
Offshore Companies Q&A
Form an Offshore Co.
ATED for Companies
 Property Tax Planning
Property Investment
Overseas Property Tax
Private Residence Relief

home | Non Domicile Tax Q&A | Inheritance Tax and Excluded Propert . . .

Inheritance Tax and Excluded Property Trust


If an individual is non dom and non resident and are very keen on returning to UK. If they set up an Excluded Property Trust for all of their offshore assets including Main residence & Investment bonds, would the assets be free of IHT once they are back in the UK as residents. Furthermore can they still have access to the assets within the trust should they need to sell the property held within the trust. On death what are the IHT implications should the beneficiaries of wish to encash bonds and cash.


Yes the main reason for making an excluded property trust would be to avoid the risks of you obtaining a UK actual or deemed domicile.

Trust property is excluded property (ie outside the scope of UK IHT) if:

  • You are non UK domicile at the time you made the settlement to the trust, and
  • The assets aren't not situated in the UK

    So provided the assets are offshore the only issue is whether you are non domiciled when the trust was set up. The assets would remain excluded property if you acquired UK residence or UK domicile in the future.

    The individuals would be able to have access to the assets etc although clearly any distributions etc could be subject to UK tax. There are numerous anti avoidance rules that would need to be considered in relation to transfers to the settlor or beneficiaries (in terms of both income tax & capital gains tax). We've covered these in various articles on the site.

    There won't be IHT implications on death (if the trust is an excluded property trust) however there could be income tax or CGT on the distribution of assets.

    About the Author

    Lee Hadnum The Author of this article/answer is our site Editor, Lee Hadnum. Lee is a rarity among tax advisers having both legal and chartered accountant qualifications. After qualifying a prize winner in the Institute of Chartered Accountants exams, he also went on to become a chartered tax adviser (CTA).

    He worked in Ernst & Youngs Entrepreneurial Services department for a number of years before setting up his own tax planning practice. He is now a full time tax author.





    i) Please note that the articles/answers contain general guidance only and do not constitute accountancy, tax, investment or other professional advice.

    ii) The contents of this article/answer are for information only and are intended to assist readers in identify any tax planning opportunities that may be available to them. The information contained in this answer is not intended to be a substitute for taking proper taxation advice and should not be relied upon in this way. Always consult a qualified accountant or taxation adviser. Your situation will then be looked at individually and specific advice relevant to your circumstances can be given. The Expert does not accept responsibility for any loss arising as a result of reliance on any information contained in this answer.

    These Notes (and Disclaimer) do not affect your statutory rights in the United Kingdom.

  • How to reduce tax
    Buy To Let Tax Planning 2014
    How To Avoid CGT In 2014/2015
    Inheritance Tax Planning 2014
    Non-Resident and Offshore Tax
    Non Dom Tax Saving Tactics
    Tax Planning for Companies
    Tax For Offshore Companies
    Tax Planning For Fiscal Nomads
    The World's Best Tax Havens
    15 Ways To Reduce Taxes
    E-Commerce Tax Planning 2014
    Entrepreneurs Relief Guide
    Excluded Property Trusts
    Family Tax Planning Handbook
    IHT Planning For Non Doms
    Immigration Tax Planning
    Offshore Co's & UK Property
    Offshore Structuring 2014
    Offshore Tax Secrets 2014
    Offshore Teleworking 2014
    Royalty Tax Planning 2014
    Selling Your Business
    Statutory Residence Test 2014
    Tax & Termination Payments
    Tax For Property Developers
    Tax Planning For Dividends
    Tax Planning For Family Homes
    Tax Planning With LLP's
    Tax Planning With SPV's
    Tax Planning With Tax Treaties
    Tax Planning With Trusts 2014
    Tax Planning:Overseas Property
    Temporary Non Residents:UK Tax
    UK Agency/Nominee Structuring
    Using A Holding Company: 2015+
    Using An Offshore Finance Co.
    Where To Base Your Offshore Co
    Working Overseas: Tax Planning
    CGT Planning If You Emigrate
     Discussion Forum
    Recent Forum Posts - Platinum Forum
    • 30 day B&B rule
    • share dealing by individual
    • UK property owned by Jersey Company managed by UK company
    • W8-BEN
    • UK Land Sale
    • CGT on UK property owned by Corporate bodies
    • Offshore company
    • Internet Based Business and moving overseas...
    • CGT implication gifting an inherited property to my brother
    • Trust and offshore IBC for selling software
    Search Discussion

    How to avoid CGT 2014/2015

    Family Tax Planning Handbook 2014

    Offshore companies: 15 ways to reduce taxes

    worldwide capital gains tax calculator 2014

    Worldwide corporation tax calculator 2014

    Personal tax calculator

    Inheritance tax planning handbook 2014/2015

    Tax planning with trusts 2014

    CGT planning for 2015

    Tax Planning For The Statutory Residence Test: 2014/2015

    Non resident and offshore tax planning

    The world's best tax havens

    Working overseas - the complete tax planning guide 2014/2015

    Tax planning for the family home

    IHT planning for non UK domiciliaries

    Tax planning with offshore companies and trusts

    Tax planning for property investors

    Tax Planning For Fiscal Nomads & Perpetual Travellers

    How to avoid capital gains tax 2013/2014

    tax planning for company owners

    Tax saving tactics for non-doms

    worldwide tax calculator

    Gold members area

    Using a company tax calculator

    EU Tax Calculator

    Here's what our members are saying ...
    "I joined the site after reading an offshore tax guide and was certainly not disappointed. The practical and 'to the point' tax planning has already saved me a considerable sum. I'd recommend this website to anyone."
    Jerry Brown, Edinburgh

    "From my experience, the advice offered by the team at WPR is second to none and compliments what is normally provided by a high street accountant and offers members quality analysis and advice on complicated tax situations both on and offshore.

    I regularly receive a blank look and "I don't know about that" with regard to more imaginative questions and a visit to this site helps me move on. thank you."
    Peter Jones, Germany

    "I've saved £5,659 in CGT by using this site to double check my accountants advice. My wife has also identified further income tax savings of over £2,000 as result of the property tax articles. In our case it's well worth the £10 membership fee."
    Derek Bailey, Birmingham

    I must thank you for the most informative reply to my enquiry. It is so extensive, I intend setting an evening aside to absorb it all.

    Again, thank you for a most useful website.
    RB, UK

    "Well written reports that are clear and insightful. I look forward to reading them every week!
    Natasha Foude, France

    "I have to say your web site is by far the best prepared and most informative that I have seen."
    Elsa Budding, Newcastle

    "I'm planning my emigration and the offshore reports are exactly what I'm looking for. I'll definitely be renewing!"
    Sarah Mather, Reigate, Surrey.

    "The property tax advice service was excellent, and I'd have no problems recommending it to anyone. I received my answer within 1 day and was very pleased with the response
    Robert Saunders, Leicester