Countries with no inheritance tax: what it means for a UK estate

Several developed countries levy no inheritance tax, estate tax or death duty at all, among them Australia, New Zealand, Canada, Sweden, Norway, Portugal, Austria, Israel, Singapore and Hong Kong. For a UK family, though, living in or moving to one of these countries does not automatically remove a liability to UK inheritance tax on your estate.

That gap between "no local death tax" and "no UK tax" is where most misunderstandings sit. This guide sets out which countries have no inheritance tax, why "no inheritance tax" rarely means "no tax at all", and how UK inheritance tax can still apply based on where you have been resident. Figures are current as at August 2026 and are subject to change.

Which countries have no inheritance tax?

A number of countries have either never introduced a death tax or have abolished the one they had. The table below lists widely recognised examples. Foreign tax rules change often and can turn on residence, citizenship and the type of asset, so treat this as a general starting point and confirm the current position with the tax authority of the country concerned before making any decision.

General information compiled from public tax-authority sources, as at August 2026, subject to change. Foreign rules vary and should be verified locally.

Why "no inheritance tax" is not the whole picture

A country with no inheritance tax may still tax a death in other ways, so the headline can be misleading. The three most common are worth understanding before you assume an estate will pass tax free.

• Capital gains on death. Some countries, Canada being a well known example, treat a person as having sold their assets at market value on death, which can create a capital gains charge even though there is no inheritance tax.
• Transfer or stamp duties. Others apply a stamp or transfer duty when property or wealth changes hands, sometimes only for beneficiaries outside the immediate family.
• Gift tax. A country may tax lifetime gifts even where it does not tax estates, which can affect plans built around giving assets away.

None of this makes these countries a poor choice; it simply means the phrase "no inheritance tax" is not the same as "tax free". The detail matters, and it changes from country to country.

Does moving abroad remove UK inheritance tax?

Often, no. From 6 April 2025 the UK moved from a domicile-based system to a residence-based one for inheritance tax. Under the current rules, a person is a long-term UK resident, and their worldwide estate is within the scope of UK inheritance tax, once they have been UK tax resident for at least 10 of the previous 20 tax years (gov.uk, long-term UK residence and inheritance tax, as at August 2026, subject to change).

Leaving the UK does not end that exposure straight away. Worldwide assets can remain within UK inheritance tax for a further period, sometimes called the "tail", of between 3 and 10 years after departure, depending on how long the person was resident (gov.uk, as at August 2026, subject to change). Separately, assets physically located in the UK, such as a house or UK land, generally stay within UK inheritance tax regardless of where the owner lives (gov.uk/inheritance-tax, as at August 2026, subject to change).

So a long-term UK resident who retires to a country with no inheritance tax may still leave an estate that UK inheritance tax reaches, for several years and, for UK assets, indefinitely. Cross-border estates can also face a claim from more than one country, which is where double-tax arrangements and specialist advice become important. Our guide to UK inheritance tax covers how the domestic charge is calculated.

The UK thresholds that still apply

Where UK inheritance tax applies, it is charged only on the part of an estate above the available tax-free thresholds. The standard rate is 40%, reduced to 36% where at least 10% of the net estate passes to charity (gov.uk/inheritance-tax, as at August 2026, subject to change).

Source: gov.uk/inheritance-tax, as at August 2026, subject to change. The residence nil-rate band is withdrawn by £1 for every £2 by which the estate exceeds £2,000,000. These thresholds are frozen until 5 April 2031, the end of the 2030-31 tax year, as confirmed at Budget 2025 on 26 November 2025 (gov.uk, inheritance tax thresholds, as at August 2026, subject to change).

A single person leaving a home to direct descendants may pass on up to £500,000 before inheritance tax, and a married couple or civil partners up to £1,000,000, by combining both allowances (gov.uk, as at August 2026, subject to change). These are the same domestic reliefs that apply whether or not any overseas move is planned.

One further change is worth noting for anyone with a UK pension. From 6 April 2027, most unused pension funds and death benefits are due to be brought within the value of the estate for UK inheritance tax, an announced future change rather than current law (gov.uk, unused pension funds and death benefits, as at August 2026, subject to change). A UK pension is often a significant part of the wealth of someone retiring abroad, so this is a general point to keep in view.

Practical steps for UK families with an overseas dimension

If part of your planning involves living abroad or holding foreign assets, a few general points tend to come up. They are starting questions rather than answers, because the right course depends on your circumstances.

• Check your residence history. The 10-of-20-years test drives whether your worldwide estate is in scope, so the number of UK tax years matters.
• Map where your assets sit. UK-situated assets generally remain within UK inheritance tax wherever you live.
• Consider lifetime giving carefully. UK rules include a 7-year period for many gifts and an annual exemption of £3,000 (gov.uk, inheritance tax and gifts, as at August 2026, subject to change), while the destination country may tax gifts differently.
• Keep your will current in each jurisdiction. A will valid in one country may not deal cleanly with assets in another; our guide to writing a will explains the basics for England and Wales.
• Take cross-border advice. Where two countries could tax the same estate, a qualified adviser can consider treaties and reliefs before anything is put in place.

Scotland and Northern Ireland

Inheritance tax is a UK-wide tax, so the thresholds and residence rules above apply across the whole of the United Kingdom. What differs by nation is succession law, the rules on who inherits and how an estate is administered. Scotland has its own system, including legal rights that can entitle a spouse and children to a fixed share, and it uses confirmation rather than a grant of probate. Northern Ireland has a separate but broadly similar system to England and Wales. Where an estate spans more than one jurisdiction, advice in each can be worthwhile.

Frequently asked questions