Client Suitability and Minimum Thresholds for Offshore Planning Structures

These structures are not designed for the average investor. They are intended for ultra-high-net-worth clients with sufficiently significant assets and sufficiently complex cross-border considerations to justify the legal, tax, governance, and compliance work involved.

The starting point is therefore not:

“Can this structure be implemented?”

It is:

“Is this structure appropriate for this particular client?”

👤 1️⃣ Who Is the Structure Designed For?

The intended client profile generally includes individuals who:

• Have substantial UK commercial real estate or mixed investment portfolios

• Have complex international tax or estate-planning considerations

• Are non-UK domiciled under the relevant historical framework or, under the current regime, are not within the applicable long-term UK residence rules

• Require sophisticated succession and estate planning

• Are prepared to maintain rigorous compliance across every relevant jurisdiction

The economic scale of the client's assets must also justify the significant professional, governance, and administrative costs involved.

🏢 2️⃣ Commercial vs. Residential Property

The first substantive question for advisers is:

What type of UK property does the client own?

This distinction is critical.

UK commercial property held through an offshore company can produce a materially different inheritance tax analysis from UK residential property because the anti-enveloping provisions applying to residential property can significantly restrict the availability of excluded-property treatment.

Accordingly, the structure should not be evaluated without first identifying the underlying asset class.

🇬🇧 3️⃣ The Settlor's Residence Status

The second major variable is the settlor's UK residence history.

Under the post-April 2025 inheritance tax framework, the concept of long-term UK residence is central to determining the treatment of foreign property for IHT purposes.

The adviser therefore needs to establish:

• The settlor's historical UK residence

• The relevant tax years

• Whether the statutory long-term residence test is satisfied

• Whether transitional or tail provisions apply

Only after this analysis can the excluded-property position be properly assessed.

⚖️ 4️⃣ What the Structure Does—and Does Not—Achieve

The distinction between probate visibility and ownership transparency is fundamental.

A properly structured offshore ownership arrangement may change the way assets pass on death and potentially avoid a conventional UK probate process involving the deceased's direct ownership of the underlying property.

But that does not mean the ownership chain is invisible.

UK transparency regimes—including the Register of Overseas Entities—can require disclosure concerning overseas entities holding UK land.

The appropriate description is therefore:

Potential probate visibility reduction—not ownership invisibility.

🔍 5️⃣ EOIR Is a Separate Question

The same distinction applies to Exchange of Information on Request (EOIR).

The fact that a particular structure may not fall within a particular automatic reporting pathway does not mean that information can never be obtained by a tax authority.

Advisers must separately consider:

• Domestic information powers

• International exchange-of-information agreements

• CRS and FATCA classification

• UK professional intermediaries

• Beneficiary and settlor reporting

• Corporate and property transparency regimes

The analysis must therefore distinguish between automatic reporting, information available on request, and direct domestic information-gathering powers.

💷 6️⃣ UK Tax Compliance Is Non-Negotiable

This structure is not intended to eliminate the normal UK tax obligations associated with UK real estate.

Depending on the property and structure, these may include:

• ATED for qualifying enveloped residential property

• UK taxation of gains on UK land

• Corporation tax on rental profits of non-UK companies carrying on a UK property business

• SDLT and other property transaction taxes on acquisition

A client seeking to avoid these obligations is not an appropriate candidate.

The structure must be built around compliance, not concealment.

📋 7️⃣ Minimum Technical Review

Before proceeding, advisers should establish at least:

1. Property classification

Is the underlying asset commercial or residential?

2. Residence analysis

Does the settlor fall within the current long-term UK residence rules?

3. IHT analysis

Can excluded-property treatment potentially apply?

4. Corporate structure

Who legally owns the UK property?

5. Trust analysis

What law governs the trust and where are the trustees resident?

6. CRS/FATCA classification

How does each entity classify under the applicable reporting regimes?

7. EOIR analysis

What information-exchange mechanisms could apply?

8. UK compliance

Which UK tax and reporting obligations remain fully applicable?

Only after those questions have been answered should the structure be considered from a planning perspective.

🎯 8️⃣ Who Should Not Use the Structure?

The structure is inappropriate for a client whose primary objective is to:

❌ Conceal beneficial ownership

❌ Avoid mandatory UK tax filings

❌ Evade ATED or other property taxes

❌ Conceal rental income or gains

❌ Prevent legitimate information requests

❌ Rely on the absence of automatic reporting as a substitute for legal compliance

Sophisticated international planning requires the opposite approach: full transparency where required, combined with careful use of the distinctions that the law actually provides.

🏛️ 9️⃣ London Presentation

The full framework will be presented at The Connaught in London on 15 September 2026, covering the interaction between:

• Offshore trusts

• UK commercial property

• IHT excluded property

• CRS and FATCA

• EOIR

• ROE

• Probate and succession

• Cross-border compliance

Further information is available through the project website.

🔑 Key Takeaway

The appropriate client is not simply someone who owns a large amount of UK property.

The structure requires a combination of:

✅ Significant asset value

✅ Suitable property characteristics

✅ Appropriate UK residence status

✅ A genuine estate-planning objective

✅ Capacity to meet ongoing UK tax obligations

✅ Willingness to undergo detailed CRS, FATCA, and EOIR analysis

The objective is not to make ownership invisible. It is to determine whether the law permits a particular ownership and succession structure to achieve legitimate IHT and estate-planning outcomes while remaining fully compliant with every applicable UK tax, transparency, and reporting obligation.