Rise of the teenage property tycoons due to changes in UK tax
Moves to close inheritance tax loops for non-domiciled families could see UK property ownership passed to the youngest adult family member to delay IHT tax bills. Super-wealthy foreign families living in Britain are being advised by tax advisors to gift their properties to their youngest sons and daughters as a way of deferring IHT. London districts such as Knightsbridge are the most popular for the super-rich and a Private Eye investigation revealed that £170bn-worth of UK property was purchased via offshore vehicles over the past decade with London being the primary target.
A tourist has her photograph taken next to a Gold Ferrari in Knightsbridge in London. Dan Kitwood/Getty Images

LONDON — Super-rich foreign families living in the UK are being advised to give multi-million-pound properties to the youngest member of their family in a bid to put off inheritance tax, according to a report in the Financial Times.

The FT spoke to several tax advisors who said they are telling rich non-domiciled clients to consider gifting properties to their young sons and daughters following a change to inheritance tax announced in last summer's budget.

Then Chancellor George Osborne moved to close a loophole that allowed non-dom families to avoid inheritance tax on British property if owned through an offshore vehicle. Inheritance tax is charged at 40% for any estate worth over £325,000 ($406,111).

The FT quotes Gary Heynes, the UK head of private client and family wealth at accountancy firm RSM, as saying:

"We are discussing with clients whether they may wish to de-envelope it and gift it to a son or grandchild, to basically pass it on to the youngest adult in the family. If you can push it down to the ownership of someone in their 20s or younger, you’ve deferred the IHT ... it could create a group of 18-21-year-old property multimillionaires."

London areas such as Knightsbridge have long been popular homes to the super-rich from around the world. A Private Eye investigation in 2015 identified £170 billion-worth of British property purchased through offshore vehicles in the last 10 years, with London the biggest hotspot.

You can read the full FT story here.