Margaret Thatcher’s Estate Paid No Inheritance Tax
Former prime minister Margaret Thatcher was always a controversial figure, and now that her estate has been seen to avoid paying many millions in inheritance tax, the controversy rages on.
The reason behind this zero tax bill is that Mrs Thatcher Belgravia house is registered to an offshore trust.
Margaret Thatcher’s will left £4.7 million to be shared between her children, Mark and Carol, and her grandchildren (once they reach the age of 25). However, in addition to that money were was a house located in Chester Square, which was valued at £12.5 million. Normally that house would have been subject to inheritance tax at either 40 percent of any value over £325,000 up to £5 million. However, in order to be subject to the inheritance tax rules, the property would need to be registered to a UK resident.
And Mrs Thatcher’s house was not. In 1991 it was bought by Bakeland Property Ltd who then sub-leased the house to a company with the same name, which is registered in the British Virgin Islands – this just happens to be an offshore tax haven.
Since this is the case, despite the fact that Mrs Thatcher died, the company that owns the house still exists. If a person owns a property and they die, that property needs to be passed to another UK resident. A company cannot die, and therefore the property does not need to be passed on to anyone.