Inheritance Tax Decision Tree

^* For alternative trusts such as will trusts please speak to a legal adviser.

^** If you are not long-term UK resident at the date of settlement then much may depend on whether you are looking to stay, or return, to the UK long term:

Looking to stay temporarily
Here you may wish to consider trusts which would otherwise create taxation issues for those who are long-term UK resident or become long term resident. For example, you may want to consider a trust which continues to allow you to benefit from the trust whilst still allowing other financial planning benefits should you die. You should also consider your future residency plans and seek advice as to whether the trust is an appropriate solution.

Likely to become long-term UK resident
If you are intending to stay in the UK, any trust you settle will no longer be excluded property once you become long-term UK resident. However, any trust of which you are not a beneficiary, including trusts, such as discounted gift trusts and reversionary interest trusts, may still be considered. As a non long-term resident at trust creation, any amount can be settled into a discretionary trust without creating an IHT entry charge and, once you become long-term UK resident in future, these trusts can help reduce the amount of UK inheritance tax you will pay.