The heirs to South Korea's Samsung conglomerate are reportedly facing a £7.8 billion Inheritance Tax bill, despite giving away a £1.3 billion art collection and donating £194 million to child cancer treatment and £647 million to support research into infectious diseases.
At 50%, South Korea's IHT tax rate is the world's second highest after Japan and this IHT payment is one of the largest globally.
Around 23,000 pieces from the late Chairman's collection will be donated, including 14 items classed as National Treasures that will be showcased at the National Museum of Korea. Works by Western artists, including Claude Monet, Salvador Dali, Pablo Picasso and others will be donated to the National Museum of Modern and Contemporary Art.
Whilst the figures are eyewatering, this is a useful reminder of the IHT incentives for owners of valuable art. There are various schemes in the UK that either allow public access to privately owned works of art or provide the opportunity for UK museums, galleries and archives, to acquire pre-eminent works of art, and these can provide significant IHT savings for willing donors.
Regardless of whether you have items of "pre-eminence", gifts of art and other objects, or cash to charities in general are free of IHT. Gifts to charity on death which represent 10% of the net chargeable value of an estate, will result in an overall reduced rate of inheritance tax of 36% on that estate rather than the usual 40%.