UK Domicile

Published / Last Updated on 13/05/2021

Domicile Rules and Inheritance Tax

What is Non Domicile or Domicile?

Domicile is a legal term peculiar to English law.  Many countries have adopted and copied the English Common Law system, many also have 'domicile' laws.

Think of domicile as your natural and permanent home.  The place where you plan to be buried.  The place where you plan to return to if you move overseas.

If you are domiciled or deemed domicile in the United Kingdom, your estate is subject to UK inheritance tax on worldwide assets.

You can live in Spain for 30 years and own a house there, but if you were born in the UK and you keep a UK bank account or retain a small property in the UK, i.e.  it can be clearly seen that you may intend to return to the UK to live, you are subject to UK Inheritance tax rules on death on worldwide assets.

Domicile at Birth - your Domicile of Origin

In England and Wales, you acquire your domicile from your father's domicile, although if you are illegitimate you take your mother's domicile.  In Scotland, your domicile of origin is where you spend your childhood years living.

Marriage before 1974: a wife who married before January 1974 automatically takes her husband's domicile.

Inheritance Tax for UK Domiciles 

  • If you are domiciled in the UK, you are subject to inheritance tax IHT on worldwide assets.
  • If you are domiciled outside UK, you are subject to inheritance tax IHT only on property in the UK.
  • If you have moved to the UK from overseas and if you have been in the UK for at least 17 out of 20 previous years.  You are deemed domicile UK and subject to inheritance tax IHT on worldwide assets.
  • If you are UK domiciled and emigrate away from the UK and are not resident in the UK for tax purposes in given tax years, you are treated as UK domicile for at least 3 years after having left, you may then assume a Domicile of Choice, assuming certain basic intentions and commitments can be clearly proven.

What if I move overseas, can I change my domicile? Acquire a Domicile of Choice

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