Moving abroad is usually framed as an income-tax decision. Inheritance tax rarely gets the same scrutiny — and it is where the most expensive surprises live. Estate and succession regimes trail residents and non-residents across borders using rules that look nothing like income-tax rules: a UK long-term resident can remain in scope years after leaving; a French estate can be forced open to distant heirs; a Spanish inheritance bill can vary by an order of magnitude between two adjacent regions; and a US citizen or domiciliary carries worldwide estate exposure regardless of where they die.
The picture is made worse by a much thinner treaty network. Countries have roughly 3,000 income-tax treaties in force worldwide; the corresponding estate, inheritance and gift-tax treaty network is a small fraction of that, leaving many cross-border deaths with no clean allocation mechanism at all. This analysis walks through the four regimes most commonly cited by internationally mobile taxpayers — the United Kingdom, France, Spain and the United States — and shows where the traps sit.
The four traps in one paragraph
- United Kingdom: IHT moved to a residence-based system on 6 April 2025. Long-term residents (10 of the last 20 UK tax years) remain in scope on worldwide assets, and the tail continues after departure.
- France: Forced heirship (réserve héréditaire) reserves fixed shares of a French estate for descendants, overriding many foreign wills. Inheritance tax runs 5-45% depending on relationship.
- Spain: Inheritance and gift tax is levied nationally but almost entirely rebated at the regional (autonomous community) level — so effective rates range from close to zero in Madrid and Andalusia to well into double digits elsewhere.
- United States: Federal estate tax reaches worldwide assets of citizens and domiciliaries, and reaches US-situs assets of non-residents at a very low exemption threshold. Renouncing citizenship triggers its own expatriation regime.
United Kingdom: the long tail after the 2025 reform
Until 6 April 2025, UK inheritance tax turned on the common-law concept of domicile — a sticky, evidence-heavy status that could persist for years after a person left the UK and be defeated only by clear signs of a permanent new home. That concept, along with the wider non-dom framework, was replaced by a residence test from that date.
The new rule: a person is a "long-term resident" if they have been UK tax resident for at least 10 of the previous 20 UK tax years, and long-term residents are exposed to UK inheritance tax on their worldwide estate. The nil-rate band remains £325,000; the standard rate above it is still 40%. Non-long-term residents are only in scope on UK-situs assets, broadly matching the old position for non-domiciliaries.
The "long tail" is the sting. Someone who becomes a long-term resident and then leaves the UK does not lose the exposure the moment they board the plane. Under the new rules the tail runs for a number of tax years after the last year of UK residence — up to around 10 years for the longest-tenured residents — before worldwide-estate exposure fully falls away. For someone who lived in London for a full career and then retired to Dubai, that means UK IHT continuing to shadow the estate for the better part of a decade after departure. Exact tail-length calculations should be verified against the current HMRC guidance and any transitional provisions.
Two related pieces of the 6 April 2025 reform are worth naming for anyone doing succession planning alongside income-tax planning. The non-dom regime was abolished and replaced by a four-year Foreign Income and Gains (FIG) regime for genuinely new arrivals. And a Temporary Repatriation Facility lets prior remittance-basis users designate pre-6 April 2025 unremitted income and gains at 12% during 2025/26 and 2026/27, rising to 15% in 2027/28 — a narrow window worth using or losing. See also the Statutory Residence Test explainer for how UK residence is actually counted.
France: forced heirship overrides the will
France taxes worldwide inheritances of French tax residents, and taxes French-situs assets received by any beneficiary regardless of where they live. Rates in the standard scale run from 5% up to 45%, but the effective rate depends almost entirely on the relationship to the deceased. Surviving spouses and PACS partners are generally exempt from inheritance tax. Direct-line descendants pay progressively up to 45% after per-child allowances (€100,000 per parent-child line as of 2026). Siblings pay in the mid-range. Unrelated beneficiaries — including step-children who were never legally adopted, and unmarried partners without a PACS — can pay 60% flat.
The trap that catches expats hardest is not the rate schedule. It is réserve héréditaire, the French forced-heirship rule that reserves a fixed portion of the estate for the deceased's children. A person with one child cannot dispose of more than half of the estate by will; with two children, one-third; with three or more, one-quarter. This applies to French-situs assets — most obviously French real estate — regardless of the deceased's nationality or the governing law of the will.
The 2015 EU Succession Regulation (Brussels IV) allowed non-French nationals to elect the law of their nationality to govern succession of their entire estate, providing a route around French forced heirship for many British, Irish and other testators. A 2021 French law then narrowed that route: where a child would be disinherited under a chosen foreign law and either the deceased or a child is an EU citizen or habitually resident in the EU, that child can now claim a compensatory share against French-situs assets. The route still exists; it is no longer clean.
Layered on top: France runs an Impôt sur la Fortune Immobilière (IFI), a wealth tax specifically on real estate above €1.3M at 0.5-1.5%, which applies annually to French residents' worldwide property and to non-residents' French property. It is not an inheritance tax, but it typically arrives at the same audience — and the same French home tends to trigger both.
Spain: the regional lottery
Spain's inheritance and gift tax (Impuesto sobre Sucesiones y Donaciones) is set by national law but administered — and heavily modified — by the 17 autonomous communities. The state scale reaches into the mid-thirties before the coefficient adjustment for pre-existing wealth and relationship class. What actually gets paid depends on where the deceased was tax-resident and, in some cases, where the beneficiary is tax-resident.
In practice the difference is dramatic. Madrid, Andalusia, Galicia and several other communities apply bonificaciones (regional rebates) of up to 99% to close-family transfers, driving the effective inheritance-tax rate on a spouse or child close to zero. Catalonia, Asturias and Valencia have historically sat at the other end of the spectrum, with meaningful effective rates on larger estates. Two Spanish tax residents dying with identical assets a hundred kilometres apart can leave their families with radically different bills. Non-residents inheriting Spanish-situs assets are entitled by EU law (following ECJ case law) to elect the rules of the autonomous community with the closest connection to the estate — a point routinely missed in the initial estate filings.
Spain also runs a wealth tax and a temporary solidarity tax on net wealth above €3M, both extended through 2026 and, in Madrid and Andalusia, largely neutralised by the same bonificaciones that flatten the inheritance-tax schedule. The Beckham Law — Spain's inbound employment-income regime — does not shield estates from Spanish inheritance tax on Spanish-situs assets, a point routinely missed by new arrivals attracted by the income-side headline rate.
United States: worldwide reach and the citizenship trap
The US federal estate-tax regime is unusual in three ways that all matter to internationally mobile taxpayers.
First, US citizens and US domiciliaries are subject to federal estate tax on worldwide assets. The lifetime exemption was raised to $15M per individual ($30M per married couple) effective 2026 under the One Big Beautiful Bill Act signed on 4 July 2025, and is indexed thereafter. The rate schedule above the exemption tops out at 40%. Prior law would have reverted the exemption to roughly $7M after 2025 — the raise is the reason the 2026 estate-tax planning landscape looks materially different from 2024.
Second, US-situs assets held by non-resident non-citizens are subject to federal estate tax with an exemption of only $60,000 unless a specific estate-tax treaty provides otherwise. US-situs includes US real estate, tangible property physically located in the US, and shares in US corporations. It does not include most US-issued portfolio debt or US bank deposits held by non-residents. A French citizen dying with a $2M New York apartment and no other US ties can face a federal estate-tax bill well into six figures unless treaty relief applies.
Third, US citizenship-based taxation means moving abroad does not end estate-tax exposure. Only formal expatriation does, and the expatriation regime itself has teeth: covered expatriates trigger a mark-to-market exit tax on worldwide assets, and subsequent gifts and bequests from a covered expatriate to a US person are taxed at the top estate-tax rate under IRC section 2801. Leaving is a transaction, not an escape.
Domicile for federal estate-tax purposes is a facts-and-circumstances test — physical residence combined with intent to remain indefinitely. Non-citizens who move to the US on a long-term basis can become domiciled for estate-tax purposes surprisingly quickly, exposing their worldwide estate to US tax while their income-tax residence status may still be more limited. As of 2026, verify current position with US counsel before making any transfer.
The treaty gap
The double-taxation problem is real: a person can be a UK long-term resident, tax-resident in France, and holder of a US-situs investment portfolio all at once. Three regimes can each claim primary taxing rights over the same asset at death.
Estate, inheritance and gift-tax treaties do exist, but the network is much thinner than the income-tax treaty network covered in our treaties guide. The United States has roughly 15 estate or gift-tax treaties in force, versus around 65 income-tax treaties. The United Kingdom has estate-tax treaties with the US, France, the Netherlands, Ireland, Italy, Switzerland and a small handful of others. France maintains a modest set of succession treaties; Spain's network is likewise limited. Many bilateral combinations that produce clean income-tax outcomes have no corresponding estate-tax relief at all — meaning full double-tax exposure absent unilateral credit.
Where an estate-tax treaty does apply, it typically allocates situs-based taxing rights (real estate follows the country in which it sits; business assets follow the permanent-establishment country) and provides a credit mechanism for the remainder. Where no treaty applies, taxpayers depend on unilateral foreign-tax-credit provisions in domestic law, which are patchy and often only creditable against tax on the same asset — not against tax on other assets in the estate. Verify the current treaty list with each jurisdiction's finance ministry before assuming coverage.
What the traps have in common
Three patterns show up repeatedly across the four regimes:
- Situs matters more than income-tax intuitions suggest. Real estate is almost always taxable in the country where it sits, regardless of the deceased's residence. Directly-held foreign real estate is one of the most common accidental-exposure items — especially for retirees who buy a French or Spanish home without restructuring ownership.
- Residence and domicile drift. UK long-term-resident status accrues silently over 10 years and unwinds slowly. US estate-tax domicile can attach faster than income-tax residence. French residence for succession purposes broadly follows tax residence but is assessed at death, not annually.
- Structural planning has to happen before the move, not after. Once residence status has vested — or forced-heirship rights have crystallised on assets already located in France — restructuring options narrow sharply and often trigger their own taxes on entry or exit.
Practical considerations before a move
The specifics change frequently — the UK reform took effect on 6 April 2025, the US exemption was raised in mid-2025, Spanish regional bonificaciones are re-legislated year to year, and the French compensatory-share regime was itself introduced only in 2021. As of 2026 the following framing tends to hold, though every point below should be verified with local counsel before acting:
- For departing UK residents, the 10-of-20-years long-term-resident test is the single most important number. Compare it against the Statutory Residence Test counters to understand where the tail begins and ends.
- For inbound moves to France, the question is whether the destination home is held directly (exposed to French situs rules and forced heirship) or through a corporate or civil-society vehicle (different tax and succession outcomes, each with their own downsides).
- For inbound moves to Spain, the choice of autonomous community can outweigh most other tax-optimisation levers combined. Choosing Madrid over Barcelona for the same job is a legitimate planning consideration on estate grounds alone.
- For US-connected estates, the divide between citizens/domiciliaries (worldwide exposure at the $15M threshold) and non-resident non-citizens ($60,000 threshold on US-situs assets) is orders of magnitude wide, and treaty coverage is patchy — verify treaty status before assuming relief.
This article is informational and does not constitute legal or tax advice. Cross-border estate planning is highly fact-specific and should be handled by qualified counsel in each relevant jurisdiction — inheritance tax rules interact with matrimonial-property regimes, succession law and treaty provisions in ways that generic guidance cannot resolve.
Where to go next
For jurisdiction-level facts and current rates, see the United Kingdom, France, Spain and United States country pages. To compare regimes side-by-side, use the compare tool. Broader background on how residence and worldwide-income concepts interact is in the tax residency guide and the treaties guide. For related wealth-transfer context, see wealth taxes by country and the France exit-tax primer. General questions are collected in the FAQ.