When considering a client’s estate planning, advisers like to reach for the most familiar tools in their arsenal. However, for US/UK clients, the tools that work in the US may not necessarily be tax-efficient in the UK. It is important therefore that any US estate plan that involves UK individuals is sensitive to UK tax rules.

Generally, there are no inherent problems with a UK person inheriting directly from a US person. Disregarding state-level US estate taxes, the cu...