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Old 12.02.2021, 06:16
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UK and Swiss Tax on Uk portfolio (?)

Does anyone know how I will be taxed on an inherited UK portfolio ?
I have dual nationality and live in Switzerland. Probate isn't finished but the portfolio is already in my name.
Thanks!
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Old 12.02.2021, 09:12
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Re: UK and Swiss Tax on Uk portfolio (?)

In the UK, the estate is taxed. So if it's worth more than the tax free limit, it'll be taxed at 40%.

Whether you pay Swiss tax depends on where you live and from whom you inherited. But most likely, there will be none to pay. Of course, it does add to your wealth.
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Old 12.02.2021, 11:18
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Re: UK and Swiss Tax on Uk portfolio (?)

Worldwide wealth (at 31-Dec) and income (from Jan-Dec) is taxed in Switzerland.

The value of the portfolio will be subject to wealth tax and any dividends received will be subject to income tax.
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Old 12.02.2021, 11:30
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Re: UK and Swiss Tax on Uk portfolio (?)

Your nationality does not play any role in this. At least from the Swiss point of view,

AFAIK inheritances from persons which had their last residence abroad are not taxed by any canton (safe local real estate). Only inheritances from people which had their last residence in Switzerland are taxed (and the mentioned real estates).
This can lead to a double taxation in case the of a Swiss resident with part of the estate abroad. In some cases this is handled by double taxation agreements in some cases such as France it can result in a quite hefty double taxation.

Taxable inheritances must be voluntarily and spontaneously declared to the tax authority ASAP. They will be taxed separately from the other income.
There is a item on the annual tax form where you can enter inheritances. This can be used to explain a sudden increase in wealth.

Any dividends, interest are taxable as income as Switzerland taxes your worldwide income has long as you are a resident.
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Last edited by aSwissInTheUS; 12.02.2021 at 11:47.
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Old 12.02.2021, 11:34
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Re: UK and Swiss Tax on Uk portfolio (?)

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Worldwide wealth (at 31-Dec) and income (from Jan-Dec) is taxed in Switzerland.

The value of the portfolio will be subject to wealth tax and any dividends received will be subject to income tax.
I don't think that was the OP's question. He/she wants to know if inheritance tax (IHT) is applicable. AFAIK if the portfolio is UK based, as NotAllThere states, then IHT will be applicable if in excess of the limit, even if you are Swiss and live here. The IHT is charged by the UK Taxman (HMRC)...
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Old 12.02.2021, 11:44
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Re: UK and Swiss Tax on Uk portfolio (?)

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I don't think that was the OP's question. He/she wants to know if inheritance tax (IHT) is applicable. AFAIK if the portfolio is UK based, as NotAllThere states, then IHT will be applicable if in excess of the limit, even if you are Swiss and live here. The IHT is charged by the UK Taxman (HMRC)...
Ah got it, thanks!
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Old 12.02.2021, 11:45
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Re: UK and Swiss Tax on Uk portfolio (?)

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I don't think that was the OP's question. He/she wants to know if inheritance tax (IHT) is applicable. AFAIK if the portfolio is UK based, as NotAllThere states, then IHT will be applicable if in excess of the limit, even if you are Swiss and live here. The IHT is charged by the UK Taxman (HMRC)...
IHT is based on the entire estate & the Nil rate band reduced by any gifts made in the last 7 years, rather than the gift being taxed.
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Old 12.02.2021, 11:47
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Re: UK and Swiss Tax on Uk portfolio (?)

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He/she wants to know if inheritance tax (IHT) is applicable.
I edited my comment above to better reflect the Swiss side of it.
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Old 12.02.2021, 14:53
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Re: UK and Swiss Tax on Uk portfolio (?)

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I don't think that was the OP's question.

Subject is "UK and Swiss Tax on Uk portfolio (?)"
And question was "Does anyone know how I will be taxed on an inherited UK portfolio ?"



I wouldn't say I have expertise on the inheritance side of think but I think, not least from what's been posted here already, that there will have been UK inheritance tax paid by the estate if the transfer was made after death, otherwise inheritance tax in the UK could be due by the OP if the transfer was made before death. As I understand it, but I'm not sure, there would be no Swiss form of inheritance/gift tax but the OP needs to declare the gift, possibly with a special form. They can google that part of it.
As of the date of transfer the portfolio becomes the OP's and he has to declare it in Switzerland for wealth and income tax purposes like he would have done if the portfolio had always been his. Without any knowledge of what the portfolio is it could be that the portfolio also attracts some UK taxation and the OP would possibly need to investigate that e.g. to see if they can claim UK tax relief.
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Old 12.02.2021, 22:59
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Thank you !
The 40% has already been paid on the whole estate, to HMRC.
What's making things complicated (for me!) is the fact that I have to fill in my Swiss Tax form before probate is finished, and before my first UK tax in April !
I'm really just trying to get my head round it. At the end of the day I'll rely on professionals, but it's nice to feel like I know what's going on!

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In the UK, the estate is taxed. So if it's worth more than the tax free limit, it'll be taxed at 40%.

Whether you pay Swiss tax depends on where you live and from whom you inherited. But most likely, there will be none to pay. Of course, it does add to your wealth.
Yes, nice problem to have!

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Worldwide wealth (at 31-Dec) and income (from Jan-Dec) is taxed in Switzerland.

The value of the portfolio will be subject to wealth tax and any dividends received will be subject to income tax.
Thank you! (I don't have access to thanks/groan buttons yet)

Last edited by 3Wishes; 13.02.2021 at 21:23. Reason: merging consecutive replies; please try multi-quote (button to the right of quote)
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Old 12.02.2021, 23:12
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Re: UK and Swiss Tax on Uk portfolio (?)

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Thank you !
The 40% has already been paid on the whole estate, to HMRC.
What's making things complicated (for me!) is the fact that I have to fill in my Swiss Tax form before probate is finished, and before my first UK tax in April !
I'm really just trying to get my head round it. At the end of the day I'll rely on professionals, but it's nice to feel like I know what's going on!
In general it is straightforward to get a deadline extension for filing your tax return in Switzerland.
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Old 12.02.2021, 23:24
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Re: UK and Swiss Tax on Uk portfolio (?)

Good to know, thanks.
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Old 12.02.2021, 23:26
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Re: UK and Swiss Tax on Uk portfolio (?)

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Your nationality does not play any role in this. At least from the Swiss point of view,

AFAIK inheritances from persons which had their last residence abroad are not taxed by any canton (safe local real estate). Only inheritances from people which had their last residence in Switzerland are taxed (and the mentioned real estates).
This can lead to a double taxation in case the of a Swiss resident with part of the estate abroad. In some cases this is handled by double taxation agreements in some cases such as France it can result in a quite hefty double taxation.

Taxable inheritances must be voluntarily and spontaneously declared to the tax authority ASAP. They will be taxed separately from the other income.
There is a item on the annual tax form where you can enter inheritances. This can be used to explain a sudden increase in wealth.

Any dividends, interest are taxable as income as Switzerland taxes your worldwide income has long as you are a resident.
Very helpful, thank you.
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Old 13.02.2021, 00:06
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Re: UK and Swiss Tax on Uk portfolio (?)

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Thank you !
The 40% has already been paid on the whole estate, to HMRC.
What's making things complicated (for me!) is the fact that I have to fill in my Swiss Tax form before probate is finished, and before my first UK tax in April !
I'm really just trying to get my head round it. At the end of the day I'll rely on professionals, but it's nice to feel like I know what's going on!
You don't need to declare the inheritance until it's been physically paid to you. If it's not in a bank account of yours, then you only declare it on your Swiss tax form when in the year you receive it...
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Old 13.02.2021, 00:29
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Re: UK and Swiss Tax on Uk portfolio (?)

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You don't need to declare the inheritance until it's been physically paid to you. If it's not in a bank account of yours, then you only declare it on your Swiss tax form when in the year you receive it...
Thanks. That's fair enough, but the portfolio is in my name before the probate is finished, which seems odd. Probate's been going on for two years now!
Presumably a portfolio is equivalent to a bank account.
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Old 13.02.2021, 01:43
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Re: UK and Swiss Tax on Uk portfolio (?)

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Thanks. That's fair enough, but the portfolio is in my name before the probate is finished, which seems odd. Probate's been going on for two years now!
Presumably a portfolio is equivalent to a bank account.

You say inheritance tax has been paid, so it's the matter of distributing the assets. You've received this 'portfolio' (of assets) so I'd consider that to be yours from the date of transfer. Quite what this portfolio holds we don't know - presumably investments of some kind, shares etc. I only know 'portfolio' to be a term to describe a group of holdings or investments. I guess it could be held with a fund manager or something, where there will surely be an account number, like a bank account.
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Old 13.02.2021, 17:36
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Re: UK and Swiss Tax on Uk portfolio (?)

Thank you all for your help and suggestions, the portfolio is shares etc. and held with a fund manager.(Rathbones)
I will come back to this thread and tell you how it goes.
Do you think it would be of interest to write about the whole inheritance "experience" once it's finalised ? (there is also some UK property involved), or, is it better to keep it short and sweet with different threads for easier searching?
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