Share this content

Under IHT will properties be taxed in both UK and India ?

Under IHT will properties be taxed in both UK...

 Father had properties in UK And India.  When his father died he was a UK citizen, domiciled in the UK.  His father did live in India for six months of the year.

He made a will in India and UK 

I understand the Indian Property will be taxed in India under IHT.

The Indian property will probably be taxed in the UK

 Will he get a credit in the UK for the Indian property that was taxed in India under their inheritance tax laws.  I assume it will depend on the double tax treaty between India and UK >


Please login or register to join the discussion.

08th Sep 2014 14:09

Not quite sure

why you think the Indian property will be taxed under IHT . IHT is a UK tax. The Capital Taxes Double Tax Agreement between India and The UK  (3 1956;SI 1956/998) will be your best place to check out the exact situation.

Thanks (0)
08th Sep 2014 14:23


The first question is why do you say that he is UK domiciled? Do you consider that deemed domicile applies, in which case, refer to the previous post.

Otherwise the response to the previous respondent's question would be because he is UK domiciled, and UK IHT taxes the worldwide estate of a UK domiciliary.

I would be inclined towards him being Indian domiciled, and, therefore, not being deemed UK domiciled because of the treaty provisions.

As I understand it though, there is not actually any IHT in India. There is an income tax charge where any property is received for less than a full consideration, meaning that you will not get any credit relief for any UK IHT.

Thanks (0)
08th Sep 2014 15:02

I thought they

introduced a form of Inheritance Tax in 2013

Thanks (0)
08th Sep 2014 15:12

I thought

It was mooted, but has yet to happen?

Thanks (0)
By taxguru
08th Sep 2014 16:14

India - First of all there is no IHT in India - there is a 'wealth tax' but that will not apply in your case. The transfer of the property through will will not lead to any CGT tax charge; however, the person acquiring the property will have the father's original cost as the 'base cost'. Income tax will be payable if there was a rental income.

UK: IHT applies but double check if he is domiciled. If deemed domicile then the overriding effect of s.158(6) of IHT will mean that the Indian property is out of UK tax net. As usual you may claim credit for any CGT and IT paid in India.

Thanks (0)
08th Sep 2014 17:33

Domicile and India

India is one of the exceptions to the deemed domicile rule, so even if he has lived in the UK for many years, he won't necessarily be UK dom for IHT.

Thanks (0)
09th Sep 2014 11:05

This FAQ answer may help

Question 3 on this suggests it is all assets worldwide.

Not sure if there is more detail in here: IHT Guide

Thanks (0)
Share this content