If you’re an expat living in Hong Kong, or anywhere else in the world, planning how to pass on your wealth could be complicated.

This is because estate planning rules vary around the world. So, if you hold assets in different countries, you’ll need to plan carefully to ensure that your heirs receive their inheritance as quickly and tax-efficiently as possible.

Indeed, the financial complexities of international estate planning could feel overwhelming. What’s more, thinking about a time when you’re no longer around might feel uncomfortable.

As a result, you may be tempted to put off estate planning tasks, even if you’re determined to preserve your loved ones’ inheritance.

Yet, putting an estate plan in place as soon as possible could allow you to take control of how your wealth is passed on. British expats may need to be especially vigilant to ensure that their estate is managed in the most tax-efficient way possible.

Read on to learn about important changes to UK tax rules that might influence your estate plan and discover four practical steps to take now if you want to leave a meaningful legacy.

Proposed changes to UK Inheritance Tax rules might affect your estate plan

While some countries, such as Hong Kong, do not apply an Estate Tax to assets you leave behind when you die, many jurisdictions do.

In the UK, this is known as “Inheritance Tax (IHT)”, and the current rate is 40%. There is usually no IHT to pay if the value of your estate is below £325,000.

If you own a UK property, or any UK situs asset, your beneficiaries might be liable for IHT even if you’re neither a UK citizen nor living in the UK at the time of your death.

On 30 October, the Labour government introduced significant reforms to IHT rules and residency policy, as part of its first Budget.

Key changes that could affect your estate plan as an expat include:

• The freeze on tax-free IHT thresholds will be extended to 2030 – The thresholds not rising with inflation could mean that your beneficiaries face a higher IHT bill.

• Reforms to the non-dom status regime – Previously, British domiciled citizens were potentially liable to pay IHT on their global assets wherever they chose to reside. From 6 April 2025, your overseas assets may fall outside the scope of IHT if your residency has been outside the UK for consecutive 10 years at the time of your death.
• UK pension funds and death benefits will be brought within the scope of IHT from 6 April 2027 – Currently, you can usually pass on pension assets without your beneficiaries facing an IHT bill. Under the new rules, pension assets may be considered part of your estate for IHT purposes. So, if you were planning to preserve your pension to pass on and use other assets for your retirement income, you might want to reconsider your strategy to ensure that it remains as tax-efficient as possible.

• Agricultural Property Relief and Business Property Relief will be capped from 6 April 2026 – Under current rules, you can claim 100% IHT relief on agricultural and business assets, which has traditionally been recognised as a key succession planning tool. However, from 2026 any such assets worth more than £1 million will only attract 50% relief.

British citizens may benefit from the changing non-dom rules. However, UK-held assets owned by non-residents may be subject to increased scrutiny for IHT purposes. This might be especially true if your UK assets form a significant part of your estate. If so, now is the time to create, or carefully review your estate plan.

Of course, the IHT liability of your estate will depend on your nationality and where your assets are situated. As you can see, British expats may need to be especially diligent when it comes to estate planning.

On the other hand, if you’re American, your beneficiaries may be less likely to face Estate Tax on their inheritance as the thresholds are much higher than in the UK.

4 key estate planning steps to take now if you’re an expat

Fortunately, there are several steps you could take now to help ensure your heirs receive their inheritance as swiftly and tax-efficiently as possible.

1. Plan for each jurisdiction where you have assets

As an expat, you may hold assets in various jurisdictions around the world. This is especially likely if you have lived and worked in different countries.

If so, an important first step toward effective estate planning is to create a detailed list of your global assets. These might include:

• Property
• Investments
• Cash savings
• Bank accounts

• Pensions

A financial expert can then help you create a plan that accounts for the different estate laws in each jurisdiction and how these could affect your beneficiary’s inheritance.

For example, you may need to write a will for each jurisdiction to ensure that your wealth is passed on in line with your wishes. This is because a will written in line with one country’s regulations may be treated as just an “expression of wishes” (which is not usually a legally binding document) in another.

2. Consider the nationality of your spouse

Locations such as Hong Kong and Singapore attract a huge number of expats from around the world. Indeed, many people living an international lifestyle marry someone who is from a different country to them.

It’s important to consider your partner’s nationality when creating or updating your estate plan, as different legal and taxation rules might apply depending on which jurisdiction your spouse is from.

This can be a complicated process, so you may benefit from working with a financial professional who has relevant expertise.

3. Appoint someone to oversee your financial affairs if you become unable to do so

You may not like to contemplate a future in which you’re unable to manage your financial affairs independently. However, planning for such an eventuality could ensure that your wealth is used in line with your wishes and that your loved ones’ inheritance is preserved.

An Enduring Power of Attorney (EPA) is a legal document that allows you to nominate a trusted person or people to look after your finances if you become unwell or lose the mental capacity to do so.

Unfortunately, nobody can predict what’s around the corner. What’s more, you must have the mental capacity to set up an EPA. So, it’s sensible to set one up sooner rather than later. As with your will, you’ll need to create a separate EPA for each jurisdiction you have ties to.

4. Work with a professional adviser to create or update your plan

As you can see, international estate planning can be a complicated process. Yet, investing the time now to ensure you have a robust strategy in place, could help you pass on more of your wealth.

Careful planning may also ensure that your loved ones receive their inheritance quickly and without any additional stress at an emotionally challenging time.

At BMP Wealth, we have extensive experience supporting our clients with international estate planning. We can help you navigate the estate laws in all the jurisdictions where you hold your assets.

If you already have an estate plan, it’s worth reviewing this every few years. You may also benefit from updating your plan if you experience certain life events, such as divorce, or if there are changes to the tax rules in countries where you hold assets.

Get in touch

To find out more about how we can help you create an estate plan that protects your wealth, family, and succession needs, please get in touch.

Email info@bmpwealth.com or call +852 3975 2878.