For Swedish Nationals Living in the UK, Residence Can Have Lasting Consequences

This is not a matter of nationality. The United Kingdom’s Inheritance Tax rules turn on where a person has been resident and for how long, not on the passport they hold. A Swedish national who has lived and worked in the UK for a number of years may be treated very differently from one who arrived last year, and the difference is not always obvious from the outside.

Because the rules reach both what a person owns and what happens to it afterwards, retirement income and estate planning are difficult to consider separately. A review establishes whether the UK rules apply at all, and whether existing arrangements still suit the position they actually create.

Arrange an initial conversation →

Why this is unfamiliar territory

Sweden abolished inheritance and gift tax for liabilities arising on or after 17 December 2004, and Swedish estates have been settled without one ever since. For most Swedish families, the question of what an estate will owe on death simply does not arise.

The United Kingdom does levy one. Someone who has spent a working career in London may hold assumptions formed in Sweden that no longer describe their position, and there is rarely a moment at which anyone tells them so.

How the residence-based rules work

From 6 April 2025 the United Kingdom bases Inheritance Tax on residence rather than on domicile. What counts is a factual residence history, not a passport and not an intention about where someone eventually belongs.

• Long-term UK residence is the trigger for worldwide assets. Someone is normally a long-term UK resident once they have been UK resident in at least ten of the previous twenty tax years. From that point, assets held anywhere in the world can fall within UK Inheritance Tax.
• The position does not end on the day someone leaves. After UK residence ends, worldwide assets can stay within scope for a period of between three and ten tax years, depending on the residence history behind it.
• UK assets are treated separately. Assets situated in the United Kingdom, a house in London for example, can remain within UK Inheritance Tax whether or not the long-term residence test is met.
• Nationality decides none of this. Two Swedish nationals of the same age can be in entirely different positions because one has lived here for fifteen years and the other for three.
• There is a convention between the two countries. A UK and Sweden convention on estates, inheritances and gifts remains in force and can matter in defined circumstances. Whether it affects a particular estate is a technical question that needs advice on the specific facts, and this page does not attempt to answer it.

Sweden does not currently levy an inheritance or gift tax, so for many Swedish families none of this has an equivalent at home. How the UK rules apply to any individual depends on their own residence history and on where their assets are situated. That is a specialist assessment.

Staying in the UK, or leaving it

Both paths raise questions, and they are not the same questions.

For someone who expects to remain in the United Kingdom, the position is comparatively settled: the UK rules apply, and the planning question is how retirement income, capital and beneficiary arrangements fit together under them. For someone who expects to return to Sweden, or to move somewhere else entirely, the position is more open. The timing of a move, what is held where at the point it happens, and how long the connection to the UK persists afterwards can all matter.

There is no single arrangement that answers both. A plan built for one outcome and then quietly carried into the other is a common source of difficulty, which is why the review usually starts with the intention rather than with the products.

Retirement income and estate planning belong in the same conversation

Decisions about retirement income are also decisions about what is left. How much is drawn from a pension and when, how much guaranteed income a household wants, how much capital is retained and for what purpose, and who is intended to benefit afterwards are all connected. Changing one changes the others.

That is true for anyone, and more so where two countries are involved. The order in which assets are used, and where they are held when they are used, can affect both the income available during retirement and the treatment of what remains. Considering the two halves separately tends to produce a plan that is defensible in each half and incoherent across both.

What happens next

1. An initial conversation. Free, and with no obligation. It is a chance to describe the situation and for us to say whether we are the right people to help.
2. A review of residence, assets and objectives. Where you have lived and for how long, what is held where, and what you want the money to do.
3. An assessment by an authorised adviser. Whether the UK rules apply, and what that means for the arrangements already in place.
4. A recommendation only where one is suitable. If nothing needs to change, that is a legitimate answer and we will say so.

Official information

The United Kingdom’s residence-based Inheritance Tax rules are set out by the government itself. For the rules as HMRC states them, rather than as summarised here, see:

• GOV.UK: Inheritance Tax if you are a long-term UK resident
• HMRC Inheritance Tax Manual: the long-term UK resident test
• GOV.UK: Inheritance Tax double taxation relief, including the conventions in force