Inheritance Tax Election for non-UK domiciled spouses and civil partners

As the UK becomes more diverse, there are more couples with just one UK domiciled spouse or civil partner ("mixed-domicile couples"). The European Commission previously criticised the limited inheritance tax (IHT) spouse exemption available for such couples on the basis that it was discriminatory. In response to this, two key changes to the IHT position of mixed-domicile couples were introduced by Finance Act 2013. This note summarises these changes and considers the practical consequences of the current regime. (For simplicity, references below to "spouses" also include civil partners).

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This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, June 2016