Last Updated: April 2026
Inheritance tax (also called estate tax, death duty, or succession tax) can consume 40% or more of wealth transferred at death. However, many developed countries have abolished it entirely.
This guide lists countries with no inheritance tax and explains strategies for tax-efficient wealth transfer across generations.
| Country | Abolished | Notes |
|---|---|---|
| Australia | 1979 | CGT on inherited assets when sold |
| New Zealand | 1992 | No CGT either—true tax-free |
| Canada | 1972 | Deemed disposition CGT at death |
| Sweden | 2005 | Social Democrats abolished it |
| Norway | 2014 | Wealth tax still applies |
| Austria | 2008 | Ruled unconstitutional |
| Portugal | 2004 | 0.8% stamp duty on property only |
| Israel | 1981 | Never re-introduced |
| Mexico | N/A | Never had federal IHT |
| Country | Rate | Notes |
|---|---|---|
| Singapore | 0% | Abolished 2008 |
| Hong Kong | 0% | Abolished 2006 |
| UAE | 0% | No inheritance tax |
| Bahamas | 0% | No direct taxation |
| Cayman Islands | 0% | No direct taxation |
| Monaco | 0% | Direct line heirs exempt |
Canada has no inheritance tax, but assets are "deemed disposed" at death:
| Country | Top Rate | Threshold | Spouse Exempt? |
|---|---|---|---|
| Japan | 55% | ¥10M (~$67K) | Partial |
| South Korea | 50% | ₩500M (~$375K) | Partial |
| France | 45% | €100K (children) | Yes |
| United Kingdom | 40% | £325K | Yes |
| United States | 40% | $13.61M | Yes |
| Germany | 30% | €500K (children) | €500K exempt |
| Spain | 34% | Varies by region | Varies |
| Belgium | 30% | None (Flanders) | Reduced rate |
Hungary has one of the most favorable inheritance systems:
Family wealth transfers are completely tax-free:
| Country | Family Rate | Others Rate |
|---|---|---|
| Italy | 4% (children, spouse) | 6-8% |
| Monaco | 0% (direct line) | 8-16% |
| Liechtenstein | Low | 27% |
Moving to a no-IHT country doesn't automatically help:
Effective planning requires:
| Country | Inheritance Tax | CGT at Death | Best For |
|---|---|---|---|
| New Zealand | None | None | Complete tax-free transfer |
| Australia | None | Deferred | Good, tax at eventual sale |
| Canada | None | Immediate | Okay, tax on gains at death |
| Singapore | None | None | Excellent for wealth |
| Hong Kong | None | None | Excellent for wealth |
| Hungary | Family: 0% | 15% | Family wealth transfers |
| Portugal | 0.8% stamp | 28% | Low cost, EU residence |
| Sweden | None | 30% | Good, despite income/CGT |
| USA | 40% >$13.61M | Step-up | Complex, planning essential |
| UK | 40% >£500K | None | 7-year rule, relief available |
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Get Expert US Expat Tax Help →Major countries with no inheritance tax include Australia, New Zealand, Canada, Sweden, Norway, Austria, Portugal, Singapore, Hong Kong, Mexico, and Israel. However, some (Canada, Australia) have capital gains tax at death instead. New Zealand is truly tax-free with neither inheritance nor capital gains tax.
No. US citizens and green card holders are subject to US estate tax on worldwide assets regardless of where they live. Renouncing citizenship can avoid future estate tax but triggers an exit tax and requires filing for 5 years after. The $13.61M exemption still applies.
Estate tax (US, UK) is levied on the deceased's estate before distribution. Inheritance tax (many European countries) is levied on recipients based on their relationship to deceased and what they receive. Practically similar, but inheritance tax rates often vary by who inherits.
In most countries, no. The US, UK, Germany, France, and most developed nations exempt spousal transfers entirely. This allows couples to defer inheritance tax until the second spouse dies. Same-sex married couples now receive same treatment in most Western countries.
In the US, inherited assets receive a 'step-up' in cost basis to fair market value at death. If you inherit shares bought for $10,000 now worth $1,000,000, your basis is $1,000,000. If you sell immediately, you owe zero capital gains tax. This is a major advantage Canada doesn't have.