The UK Changed How Inheritance Tax Works. Most Expats Haven't Caught Up.

The UK IHT Rules Changed. Here's What That Means for You.

For decades, UK inheritance tax planning was built around domicile. A concept based on origin, intention and long-term connection, it gave internationally mobile individuals meaningful planning flexibility. That framework has changed.

From April 2025, the emphasis shifts to residence history. If you have been UK resident in at least 10 of the previous 20 tax years, your worldwide assets can come into scope for UK inheritance tax, both on lifetime transfers and on death. The test is measurable, rolling, and cumulative.

And it doesn't stop when you leave. Even after becoming non-resident, inheritance tax exposure can continue for years, depending on how much UK residence sits in your recent history. Many expats assume that departure ends worldwide exposure immediately. It often doesn't.

Shil Shah, Group Head of Tax Planning at Skybound Wealth Management, explains what has changed under the new regime, how the 10 out of 20 rule operates, what the IHT tail means in practice, and why the timing of gifts and restructuring is now more critical than ever.

Watch Now

What You'll Learn

Why the shift from domicile to residence changes the rules for internationally mobile individuals, and why residence history is now the key measure of exposure
How the 10 out of 20 rule works, what it captures, and why accumulated history matters as much as current status
What the IHT tail is, how long it can run, and why leaving the UK doesn't immediately end worldwide inheritance tax exposure
How the residence-based framework changes how existing trust structures should be reviewed
Why the timing of gifts relative to your residence history can be the difference between planning that works and planning that doesn't
What returning to the UK can do to your inheritance tax position, and why it should be reviewed before re-entry, not after

‍

Who This Is For

Expats who have spent significant time in the UK and have left, or are planning to leave
Internationally mobile individuals who assumed their worldwide assets fell outside UK inheritance tax after becoming non-resident
Those planning to return to the UK who haven't reviewed their inheritance tax position
Anyone with existing trust structures built around domicile planning
High-value estate holders for whom cumulative exposure is a material risk

Why This Matters

Inheritance tax when you're young rarely feels urgent. But it is cumulative. Exposure builds quietly across years of residence history, and by the time it becomes obvious, the planning windows have often narrowed.

The move from domicile to residence is a structural shift, not a technical tweak. For expats, it changes exposure, timing and strategy. The right time to review is before departure, during non-residence, and before return. Not after the fact, when options are already limited.

Watch Now

Shil Shah

Group Head of Tax Planning

Shil brings deep UK and international tax expertise to clients who live global lives. A Chartered Accountant and qualified financial planner, he spent nine years at Deloitte and KPMG before joining Skybound Wealth, where he leads the groupwide tax planning proposition across regions and borders.