Swiss Inheritance Tax

Switzerland-UK Cross Border Inheritance Tax Switzerland-UK Cross Border Inheritance Tax

Switzerland-UK Cross Border Inheritance Tax Guide

Switzerland × UK: Cross-Border Inheritance & Gift Tax — IHT Treaty (1995), Situs & Credit Relief

Last updated: 30 Sep 2025

Switzerland × UK: Inheritance & Gift Tax — Treaty in force

Switzerland and the United Kingdom have a double-taxation convention for inheritance/gift taxes (entry into force 7 March 1995). It coordinates taxing rights mainly by domicile and situs, and provides credit relief on overlapping assets. Remember: Swiss inheritance/gift taxes are cantonal (no Swiss federal IHT), with common exemptions for spouses and—often—children.

HMRC: IHT Double Taxation Relief (treaty list) UK–Switzerland IHT Treaty (Statutory Instrument 1994/3214) Swiss basics: inheritance tax (official portal)

HMRC lists Switzerland among IHT treaty partners (in force since 7 Mar 1995). The instrument is published as UK Statutory Instrument 1994/3214. Swiss IHT is levied at the cantonal level; spouse/descendant exemptions are common.

Contents

At a glance

What the treaty does

  • Coordinates IHT/Schenkungs-/Erbschaftsteuer between the UK and Switzerland.
  • Generally gives the domicile country a wider taxing right; the other country taxes specified situs assets (e.g., local real estate).
  • Provides credit relief where both countries tax the same assets.

Why this matters

  • Prevents most double taxation when paperwork is correct (valuations, situs evidence, assessments).
  • UK has a unitary system (no state layer). Swiss taxes are at canton/commune level.
  • Swiss family exemptions (spouse/descendants) often mean focus on other classes of heirs or on UK exposure.

Taxes covered & mechanics

Topic How it works Why it matters
Taxes covered UK Inheritance Tax (IHT); Swiss cantonal/communal inheritance & gift taxes. Frames where bilateral relief can be claimed (treaty applies to IHT domain).
Domicile vs. situs Allocation rules typically: domicile taxes broadly; situs country taxes assets situated there (esp. real estate). Determines primary liability and which side gives credit.
Credit relief Credit against the second-in-line country’s tax for IHT paid in the first country on the same assets, subject to caps. Prevents double taxation; requires documentary proof.
Administration Claim relief via UK IHT filings and Swiss cantonal procedures; maintain valuations, situs evidence and tax assessments. Timely, well-documented filings are crucial.

Treaty allocation (high level)

Asset/driver Primary taxing right (typical) Notes
Immovable property (real estate) Situs country (where the property is) Swiss real estate → Swiss canton; UK real estate → UK.
Tangible movables Physical location at death/transfer Evidence location at the key date.
Bank claims / deposits Debtor location (bank) Keep statements and bank domicile evidence.
Shares / stock Place of incorporation UK plc → UK-situs; Swiss AG/GmbH → CH-situs.

Swiss cantonal landscape

Switzerland has no federal inheritance/gift tax; regimes are cantonal. Spouses are generally exempt, and many cantons broadly exempt children. Rates/allowances differ widely. See our canton-by-canton overview: Swiss Inheritance Tax by Canton.

Worked example (numbers)

Scenario
  • Decedent: UK-domiciled; dies resident in the UK.
  • Heir: Adult child resident in Zurich (Switzerland).
  • Assets:
    • UK flat (London): £1,200,000
    • Swiss portfolio (Zurich bank): CHF 800,000 (≈ £720,000 for illustration)
  • Assumptions (illustrative only): UK NRB £325k; ignore reliefs beyond NRB. Zurich exempts children from inheritance tax (common in many cantons).
Step A — UK IHT
UK taxable estate ≈ £1,200,000 + £720,000 − £325,000 = £1,595,000
IHT @ 40% = £638,000

Step B — Swiss side (Zurich canton)
Child heir: typically exempt in Zurich → no Swiss inheritance tax due.
(Check canton rules where heir resides / where real estate sits.)

Step C — Treaty relief (credit)
Overlap exists on Swiss-situs assets only if the canton taxes them; here Zurich exempts children → no Swiss tax paid → no Swiss-to-UK credit needed.
For the UK flat (UK situs), UK taxes primarily; Switzerland does not tax UK property → no double-tax overlap.

This example is simplified and for education only. Actual results depend on domicile, canton, allowances, reliefs (e.g., spouse/charity), debts, valuations, exchange rates and filings.

Planning checklist (no legal/tax advice)

  • Determine domicile (UK) and Swiss canton exposure early.
  • Map assets by situs (UK vs. CH) and type; identify overlaps likely to trigger credit claims.
  • Model credits under the treaty; prepare valuations, situs evidence, tax assessments and proof of payment.
  • Check canton exemptions (spouse/children often exempt) and any gift-tax angles.
  • Sequence lifetime gifts vs. estate; consider UK seven-year rules and Swiss canton rules.
Disclaimer: This page is general information, not advice. Outcomes depend on facts and current law across UK and Swiss cantons.

FAQ

Is there a Switzerland–UK inheritance/gift tax treaty?

Yes. The treaty entered into force on 7 March 1995 (see HMRC’s treaty list and UK SI 1994/3214).

Does the treaty remove all double taxation?

It allocates taxing rights and provides credit relief for overlapping assets. You still need proper filings and documentation.

Do Swiss cantons always tax inheritances?

No. Spouses are generally exempt, and many cantons broadly exempt children. Always check the relevant canton.

Talk to us

We model UK × Swiss exposures, align canton rules, and prepare credit-ready files under the treaty.

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