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HMRC internal manual

Inheritance Tax Manual

Liabilities: investigating liabilities: overseas taxes

Special rules (IHTM27181) apply to overseas taxes that are similar in nature to Inheritance Tax (IHT). These may in some cases be set against the IHT liability.

For other types of overseas taxes the general rule is that they can normally only be deducted from the value of property in the country that imposes the tax. This is because the taxes are unenforceable in other countries, Government of India v Taylor [1955] AC 491.

There are three exceptions to this rule:

  • tax debts in the Republic of Ireland (IHTM28101)
  • Canadian income tax on a deemed disposal on death (IHTM28102)
  • foreign tax on shares situated in the UK (IHTM27201).