Graham Parrott.

IN THESE days of financial uncertainty, for many the focus of attention has become the maintenance of capital.

In seeking what may or may not be a safer haven, many are looking to the UK and perhaps the ever-increasing number of state-owned financial institutions.

However, it is important at the same time to have one eye on the tax implications across borders and as far as the UK is concerned, yes there are some, especially when the amounts involved are significant.

While generally non-UK residents do not pay capital gains tax, it is important not to ignore any income tax issues – although that should not be an issue in the case of a simple bank account. It is also important to make sure that this does not give rise to an inheritance tax liability. IHT is payable when an individual dies and on certain lifetime gifts. Theoretically it applies to all of us, with no territorial limits.

For people who are UK ‘domiciled’, broadly people of UK origin who have not moved elsewhere permanently and those living in the UK permanently, then IHT is payable on their worldwide estate.

Therefore it does not matter where these people keep their money – all their assets are caught.