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Introduction to this document

IHT spouse’s domicile election

If you are married to a UK domiciled person, but you are non-UK domiciled, the intraspouse exemption for IHT is restricted. However, it’s possible to make an election that removes this restriction using our new template letter.

restricted spouse exemption

The general rule for transfers from one spouse or civil partner to their counterpart is that the transfer is exempt from inheritance tax (IHT) for both lifetime transfers and those made upon death. Where the receiving spouse is not UK domiciled, but the spouse making the transfer is, this exemption is restricted to the first £325,000. Gifts or legacies with values above this eat into the available nil rate band, and if that is exhausted become chargeable to IHT at 40%. To avoid this, the recipient spouse can make an election to be treated as if they were UK domiciled. This can be backdated for up to seven years but cannot predate 6 April 2013 - when the election first became available. This ability to make an election retrospectively means that, for example, a failed potentially exempt transfer that would otherwise be liable to IHT can be avoided by removing the restriction and making the transfer fully exempt. As a cautionary note, making an election is irrevokable, and immediately brings all of the recipient spouse’s worldwide assets into the IHT net - so it might not be suitable if there are substantial overseas assets.


To be able to make the election, one of two conditions must be met - depending on whether the election is being made during the lifetime of the UK domiciled spouse or after their death.

Condition A is that, at any time on or after 6 April 2013 and during the period of seven years ending with the date on which the election is made, the person had a spouse or civil partner who was domiciled in the United Kingdom.

Condition B is that a person (“the deceased”) dies and, at any time on or after 6 April 2013 and within the period of seven years ending with the date of death, the deceased was:

  • domiciled in the United Kingdom; and
  • the spouse or civil partner of the person who would, by virtue of the election, be treated as domiciled in the United Kingdom.

If the recipient spouse has died, their personal representatives can make an election if condition B is met.

Time limit

The election can be made at any time during the recipient spouse’s lifetime, but it can only be backdated for up to seven years. If the marriage has ended, an election can still be made, provided that the effective date specified was at a time prior to the dissolution. If the personal representatives are making the election, they need to do so by the second anniversary of the death.