Overseas Assets UK Estate Planning — IHT, Probate and What Happens

UK IHT on Worldwide Assets

If you are UK-domiciled (broadly, if the UK is your permanent home), HMRC taxes your worldwide estate at 40% above the nil rate band. This includes:

• Foreign property (holiday homes, investment properties)
• Overseas bank and investment accounts
• Foreign company shareholdings
• Assets held in foreign trusts (in some circumstances)

Double Taxation

Many countries also tax on death — France, Spain, Italy, the USA and others all have their own succession taxes. The UK has double taxation agreements with some countries (including the USA, France, India, Pakistan and others) to prevent the same assets being taxed twice. Relief is available even without a treaty — but must be claimed.

Ancillary Probate

UK probate (the Grant of Probate) only has authority in England and Wales. Foreign property — especially land and real estate — almost always requires local probate proceedings in addition. This is called “ancillary probate” or “resealing.”

Countries like France, Spain and Germany have their own succession laws that may override your UK Will — particularly regarding forced heirship rules that entitle children to a minimum share regardless of the Will.

Planning for Cross-Border Estates

Key considerations:

• Consider a separate Will for each country where you own property
• Review domicile status — non-UK domicile can significantly reduce IHT exposure
• Claim double taxation relief wherever available
• Structure ownership of foreign property to simplify succession (e.g. through a company in some jurisdictions)