IHT Solution
by Sterling Trust Limited

Foreign nationals who own property in the UK are liable to pay UK inheritance tax (IHT)
IHT Solution
Foresight was created by Sterling Trust Limited to offer various products for the International market place.
Traditionally purchasing a property in the UK was seen as a good investment opportunity for foreign nationals for them to rent out or use as a city crash pad. The investments were left free to flourish and take advantage of the increase in house prices in the UK.
On the 16th of November 2017 a Finance Bill was passed and backdated to 6th April 2017 which means foreign nationals who own residential property in the UK are now liable to pay UK inheritance tax (IHT) on the value of the property when they die, despite not being UK taxpayers and even if they are paying their taxes in another country. This tax must also be paid to HMRC before the property can be passed to the intended recipient. This figure could run in to millions of pounds for properties in London and the south of England.
The legislation applies to:
- all non-UK domiciled individuals owning residential property
- non-UK resident trustees directly or indirectly own residential property
- Buy-to-let investments
- Portfolio of houses
- Central London pied-a-terre for rare visits to the City
- those who have lent money or provided security for a loan to acquire, maintain or repair a UK residence
The Bill, which has not been widely publicized, brings all UK residential property into the IHT net – regardless of its ownership structure and the residency or domicile status of the ultimate owner.
As part of the Foresight strategy Sterling Trust have the solution
- Owners can take out a life assurance policy for what the IHT liability is likely to be and wrap the policy in a simple Trust with Sterling.
- With the Trust in place, once the assurance pays out, the money can be sent to the beneficiaries, bypassing probate and the owners estate.
- This solution reduces any pressure on loved ones, who might otherwise face an unexpected and onerous IHT bill, which they may have been unaware of.
Sterling Trust Limited is licensed for the provision of Trust and Corporate Services by the Isle of Man Financial Services Authority. It is not licensed for investment or life insurance business and clients should seek their own independent financial advice.
For more information please contact David Johnson at Sterling Trust Limited david@sterling.im or by calling 01624 611146

From the blog
CONTACTING US IS EASY
CALL US ON
+44 (0)1624 611146
You’ll be connected to a member of our team. They’ll be happy to help answer any questions you may have.