Inheritance Tax Act 1984

Non-residents’ bank accounts U.K.

157 Non-residents’ bank accounts. U.K.

(1) In determining for the purposes of this Act the value of the estate immediately before his death of a person to whom this section applies there shall be left out of account the balance on—

(a) any qualifying foreign currency account of his, and

(b) subject to subsection (3) below, any qualifying foreign currency account of the trustees of settled property in which he is beneficially entitled to an interest in possession.

[F1 (2) This section applies to a person who F2 ... immediately before his death [F3 is neither resident in the United Kingdom nor a long-term UK resident].]

(3) Subsection (1)(b) above does not apply in relation to settled property [F4 if—

(a) the trustees are resident in the United Kingdom immediately before the beneficiary’s death,

(b) the settlor is alive and is a long-term UK resident immediately before the beneficiary’s death,

(c) the settlor died on or after 6 April 2025 and was not a long-term UK resident immediately before they died, or

(d) the settlor died before 6 April 2025 and was not domiciled in the United Kingdom when the property became comprised in the settlement.]

[F5 (3A) This section is subject to paragraph 5 of Schedule A1 (non-excluded overseas property).]

(4) For the purposes of this section—

(a) the question whether a person is resident F6 ... in the United Kingdom shall, subject to paragraph (b) below, be determined as for the purposes of income tax; but

(b) the trustees of a settlement shall be regarded as not resident F7 ... in the United Kingdom unless the general administration of the settlement is ordinarily carried on in the United Kingdom and the trustees or a majority of them (and, where there is more than one class of trustees, a majority of each class) are resident F7 ... there.

(5) In this section “qualifying foreign currency account” means a foreign currency account with [F8 a bank F9 ...]; and for this purpose—

(a) “foreign currency account” means any account other than one denominated in sterling, F10 . . .

F10 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F11 (6) In this section “bank” has the meaning given by [F12 section 991 of the Income Tax Act 2007].]

Textual Amendments

F1 S. 157(2) substituted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 46 para. 118(2) (with Sch. 46 para. 118(5))

F2 Words in s. 157(2) omitted (6.4.2025) by virtue of Finance Act 2025 (c. 8), Sch. 13 paras. 21(2)(a), 45(1)

F3 Words in s. 157(2) inserted (6.4.2025) by Finance Act 2025 (c. 8), Sch. 13 paras. 21(2)(b), 45(1)

F4 S. 157(3)(a)-(d) and word substituted for words (6.4.2025) by Finance Act 2025 (c. 8), Sch. 13 paras. 21(3), 45(1)

F5 S. 157(3A) inserted (with effect in accordance with Sch. 10 para. 9 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 10 para. 6

F6 Words in s. 157(4)(a) omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 46 para. 118(4)(a) (with Sch. 46 para. 118(5))

F7 Words in s. 157(4)(b) omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 46 para. 118(4)(b) (with Sch. 46 para. 118(5))

F8 Words in s. 157(5) substituted (29.4.1996 with effect in relation to deaths occurring on or after 29.4.1996) by 1996 c. 8, s. 198, Sch. 37 para. 12(1)(3)

F9 Words in s. 157(5) repealed (26.3.2001) by S.I. 2001/1149, art. 3(2), Sch. 2 (with art. 4(4))

F10 S. 157(5)(b) and the preceding “and” repealed (29.4.1996 with effect as mentioned in Sch. 37 of the amending Act) by 1996 c. 8, s. 205, Sch. 41 Pt. VIII(2), note

F11 S. 157(6) inserted (29.4.1996 with effect in relation to deaths occurring on or after 29.4.1996) by 1996 c. 8, s. 198, Sch. 37 para. 12(2)(3)

F12 Words in s. 157(6) substituted (with effect as mentioned in s. 1034 of the amending Act) by Income Tax Act 2007 (c. 3), ss. 1027, 1034, Sch. 1 para. 269 (with transitional provisions and savings in Sch. 2)