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HMRC internal manual

Inheritance Tax Manual

Foreign property: Double Taxation Conventions: procedure: procedure with convention partners

Double taxation of the same property arises where both the UK and the convention partner have the right to tax that property. The conventions provide a set of rules to determine which of the countries should provide relief from that double taxation (under IHTA84/S158 (1)).

We currently have conventions for Inheritance Tax purposes with the countries listed at IHTM27161. Each convention is different.

You must consider the terms of the relevant Convention to determine what double taxation credit is due. The credit cannot then be agreed until payment of the foreign tax has been certified by the relevant convention country.

Any matters relating to the conventions with India, Pakistan or Sweden should be referred to Technical in view of the abolition of the foreign tax referred to in the convention. India’s estate duty was abolished on 15 March 1985 and Pakistan’s on 29 June 1979: Sweden’s inheritance tax was abolished on 31 December 2004. You should also refer any matters relating the conventions with Italy (IHTM27175) and Switzerland (IHTM27173).

If the taxpayer claims unilateral relief under IHTA84/S159 as well as convention relief on the same property, you must consider whether both reliefs apply (IHTM27200).