For many expatriates, wealth rarely sits in one place. Homes, investments, and accounts often span several countries, each with its own tax rules and succession laws. That mix can create uncertainty when estates pass between generations. Even where no inheritance tax applies locally, as in the UAE, foreign jurisdictions can still impose charges based on domicile or where the assets are held. Understanding how these rules connect is the starting point for effective estate planning. The sections below outline the main factors that shape inheritance and estate tax exposure for families with global assets.
Understanding inheritance and estate tax exposure
Many expatriates assume inheritance tax only applies where they live, yet for most families it follows them long after they’ve settled abroad. What matters isn’t residency but domicile, a legal concept tied to long-term roots rather than physical presence. It reflects where a person’s life is anchored, where they intend to return, or where their family ties remain strongest. Changing it takes more than time away; it usually requires proof of permanent resettlement, often backed by evidence such as property disposal, new wills, and consistent tax filings.
That’s why someone who left the UK decades ago can still fall within its inheritance tax system on assets held anywhere in the world. Across much of Europe, similar rules extend to habitual residence, capturing property and investments even when heirs live elsewhere. These links aren’t always obvious until an estate is being wound up, when local executors discover that several tax authorities have a claim. The complexity lies in how each jurisdiction defines connection, and that’s what careful planning aims to control.
Domicile, residence, and situs: where tax applies
Residence shows where a person lives, but domicile and situs often decide where inheritance or estate tax applies. Domicile is a legal concept, not a physical address. Everyone starts with a domicile of origin, usually their father’s country of permanent home at birth. It can change to a domicile of choice if a person settles elsewhere with clear intent to remain there permanently. That intent must be shown through actions such as selling property, moving family life, and cutting ties with the former home state.
Situs refers to the legal location of an asset, which determines which country can tax or control its transfer. A British national living in Dubai who owns a villa in France and shares in a UK company could fall under three sets of rules. France taxes the property, the UK taxes the shares, and UK domicile brings the entire estate back into its inheritance system. When those rules overlap, succession becomes more complex and usually demands careful coordination between advisers in each country.
Double taxation relief and planning opportunities
When two countries both claim inheritance tax on the same estate, relief is sometimes available under a treaty. These agreements decide which state taxes first and how the other gives credit for what’s already been paid. The UAE has more than 130 double taxation treaties, many of which extend to estate and inheritance tax, though not all do. Where no treaty applies, some countries offer unilateral relief, though the methods and timing often differ. Unfortunately, the rules rarely fit together neatly, so effective planning focuses on timing, ownership, and the structure through which control is held.
At Knightsbridge, we often see families benefit from holding companies, trusts, or private foundations that give assets a clear legal home. This can make taxation more predictable and succession easier to administer, especially when several authorities could otherwise claim a share.
Legal tools for succession and protection
Wills, trusts, and foundations each serve a distinct purpose in keeping succession organised and tax exposure under control. A will sets out how assets pass and which law applies, but for families with property in several countries, a single document rarely covers everything. The best approach is separate wills for each of the jurisdictions where significant assets are held, such as one registered under DIFC or ADJD rules for UAE property and another prepared under home-country law. Each will needs to stand on its own yet fit cleanly with the others. Clauses shouldn’t cancel or duplicate one another, and executors in each place should know exactly what falls under their remit.
Trusts and private foundations go a step further. They give families a way to hold assets in one organised structure that continues after the founder’s lifetime. They help transfers happen smoothly, without long probate delays or disputes between jurisdictions, while keeping decision-making within the family. When combined with clear lifetime transfers, the result is a stable framework that protects value, reduces exposure and keeps control exactly where it was intended to stay.
Preparing a coordinated estate plan
A good estate plan isn’t built all at once, it’s shaped through clear steps and steady upkeep. As a starting point, it’s worth setting out a full record of assets and where they sit, from property titles and company shares to pensions and life policies. That creates a clear view of what’s in play and which laws apply. It’s also important to review both tax residence and domicile, since those two points decide how different authorities may assess the estate. Executors or trustees should be comfortable handling cross-border matters and have reliable contacts in each country involved. Once the structure is established, it should be reviewed from time to time. A change in residence, a new business or a family event can all alter how the plan works. The aim is to keep everything documented, consistent and ready to function when it’s needed, with as few surprises as possible.
How can The Knightsbridge Group help?
The Knightsbridge Group works with international families to bring order and foresight to complex estates. With more than twenty years of experience, we help clients plan ahead, protect assets, and record their wishes in ways that hold up across borders. We advise on wills, trusts, foundations, and corporate structures so each part of a plan supports the next and aligns with UAE law.
For clear, practical guidance on structuring or updating your will, or for broader advice on succession and guardianship planning, contact info@kbgroup.ae.
