Foreign teenagers could be given £1 million+ British properties by super-rich families to avoid inheritance tax
The FT spoke to several tax advisors who said they are telling rich non-domiciled clients to consider gifting properties to their young sons and daughters following a change to inheritance tax announced in last summer's budget.
Then Chancellor George Osborne moved to close a loophole that allowed non-dom families to avoid inheritance tax on British property if owned through an offshore vehicle. Inheritance tax is charged at 40% for any estate worth over £325,000 ($406,111).
The FT quotes Gary Heynes, the UK head of private client and family wealth at accountancy firm RSM, as saying:
"We are discussing with clients whether they may wish to de-envelope it and gift it to a son or grandchild, to basically pass it on to the youngest adult in the family. If you can push it down to the ownership of someone in their 20s or younger, you've deferred the IHT ... it could create a group of 18-21-year-old property multimillionaires."
London areas such as Knightsbridge have long been popular homes to the super-rich from around the world. A Private Eye investigation in 2015 identified £170 billion-worth of British property purchased through offshore vehicles in the last 10 years, with London the biggest hotspot.
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