Our client, an elderly person, has been UK resident for the past 14 years but is looking to move to Italy. This is part of an inheritance tax (IHT) planning exercise following the reforms to the UK IHT regime. My client believes that once he is domiciled in Italy, his overseas assets will not be with the scope of UK IHT based on the treaty between UK and Italy. Would the provisions of the UK/ Italy estate treaty be beneficial for our client?

If a taxpayer is a long-term UK resident (LTR) as defined in section 6A Inheritance Tax Act 1984 (IHTA 1984), he is liable to IHT on all his assets regardless of where these are situated. All legislation references IHTA 1984.