IHTM11270 - Exemptions: diplomatic and consular immunity

This manual text reflects changes outlined in the Finance Bill 2025, which has not yet received Royal Assent. 

Under the provisions of the Diplomatic Privileges Act 1964 exemption from IHT is granted on the death of a member of a diplomatic mission to the UK who is not a national of, or permanently resident in, the UK and on the death of a member of their family forming part of their household. The exemption is limited to moveable property which is in this country solely by reason of the deceased’s presence here as a member of the mission or as one of the family of a member of the mission. 

As regards lifetime transfers (IHTM14000) IHT can be charged only in respect of gifts by a foreign diplomat of UK immovables and of investments in UK commercial undertakings. 

The exemption applies subject to the power conferred by s.3 of the Act to withdraw privileges and immunities by Order in Council in cases where those granted by the sending State are less than those granted by the Act.

Exemption on similar lines may also be granted under the provisions of 

  • the Consular Relations Act 1968 

  • the International Organisations Act 1968 

  • the European Communities Act 1972 

  • the International Criminal Court Act 2001 
     
    You should refer a claim for exemption under any of these Acts to Technical.


Long-term UK residence of diplomats and other individuals with a relevant international exemption 

For IHT purposes, s.155ZA IHTA 1984 provides that any tax years in which an individual was subject to an IHT exemption under any of the above acts (a “relevant international exemption”) are to be treated as non-UK resident years for determining whether that individual is a long-term UK resident of the UK under s.6A. 

This does not apply if the individual remains in or returns to the UK after ceasing diplomatic service. 

Example 

Maria travelled to the UK for the first time in 2014 as a member of a diplomatic mission. In 2022, she resigned her role and returned to her home country with her husband Alex. In 2024, they both moved back to the UK and Maria took up employment with Alex’s company. 

When calculating Maria’s long-term UK residence status, the years between 2014 and 2022 that Maria was present in the UK as a member of a mission will be counted as non-UK resident years.