Expatriate Estate Planning

You may think that as an expatriate you have slipped through the net and your estate will be free of inheritance taxation liabilities - well unless you have taken certain steps already this may very well NOT be the case.

How are other nationalities affected?

US - For US citizens it’s worse!  No matter where you live in the world, no matter how long you’ve lived there and no matter where your assets are in the world; at death your entire estate may be liable for US Estate Tax at 50%.

Canada - Canada doesn’t have a straight tax at death.  Instead things are far more complicated!  In Canada you have capital gains tax liable on the ‘deemed disposal’ of a person’s estate, you can have probate fees...oh and rates applicable can change from state to state!

Europe - Taking France as an example where the rules are significantly more complex, note that the top rate is 40% the same as in the UK.

Quite simply, whatever your nationality and wherever you now live, your estate may be liable for quite significant death taxes.

Death tax rates worldwide

The rates of tax applicable and the rules determining who gets what are different in every country.  Here are some examples of the top rates applicable by country:

Country - Top Potential Death Tax Rate

Australia 0%
Hong Kong 15%
Netherlands 27%
Germany 30%
UK 40%
Korea 45%
US 50%
Japan 70%

Practical liability example

Based on UK IHT: -

i. Anything left to spouse passes free of IHT
ii. Assuming a widower leaves entire estate worth £600,000 (net) to his children: -
iii. £275,000 is taxed at 0%
iv. Balance is taxed at 40%

Estate Net Value £600,000
0% £275,000
Balance £325,000
IHT Liability £130,000
% of initial Estate Value 21.67%

What’s YOUR liability?

To determine the potential death duty liability on your estate, a full and comprehensive financial review will need to be carried out. 

There are so many areas that need to be considered, and professional advice is essential to make sure that you cover every potential aspect of the situation. 

The fact that your loved ones will at least receive the remainder of your estate after death duties is simply not good enough! 

Do you WANT the tax man to benefit again from the hard work you put in through life?

Take positive action today to determine your liabilities and to protect your assets.

What can you do to reduce the liability?

I have produced an article dedicated to offshore asset protection and ways you can reduce your IHT liability.  It’s here: -

Avoiding Inheritance Tax

It offers plenty of practical advice for you to consider. 

Alternatively: -

Getting help & information

Getting to grips with the complexities of expatriate estate planning, protecting your loved ones, your estate and your own wishes requires professional advice.

Simply put -

FIRST you need to establish your liability
THEN you need to find the solutions to reduce and negate that liability. 

Step one is to have a full financial review and discuss your options with an expert. 

If you need us to assist you further please contact us, simple fill in the Offshore Advice Form and we can furnish you with more information about ways to legally negate your IHT liability or we can find a sympathetic and experienced independent financial adviser in your location with whom you can discuss your estate planning needs.

Whichever path you choose to take we wish you success with your estate planning.

If you would like more to read on this subject, I can suggest the following resource from Amazon:-

Family Wealth - Keeping It in the Family: How Family Members and Their Advisers Preserve Human, Intellectual and Financial Assets for Generations

J.E. Hughes

Himself a sixth-generation lawyer, Hughes describes how to create a dynasty.

A family’s primary wealth, he says, is human capital and intellectual capital that is, everyone in the family and everything each of them knows and only secondarily financial capital. He explains how to establish internal practices and ethics to make the fortune grow.

Most financial planners are very talented at finding ways to avoid, reduce and defer taxes. The better planners can also do a wonderful job of steering your money towards investments that will have appropriate risk-rewards characteristics for your preferences. Beyond that, some kind planners will also help you talk through the problems of your drug addict son and alcoholic daughter. But no one, in my experience, will help you think you how to nurture your family in all of its dimensions.

Family Wealth breaks through those limitations to suggest that those who head a family should be concerned about all aspects of future generations . . . especially their human, intellectual and social developments . . . as well as being sure that the resources will be there to nurture them. Mr. Hughes suggests a time frame of at least 100 years for this perspective. Otherwise, the global fear that the family will arise from one downtrodden existence to fall down into the same existence in only 3 or 4 generations will turn out to be true.

Click here to order a copy directly from Amazon!

This will open a new browser window - if you have a pop up blocker you will need to hold down the control key and then click the link!