Feeling wobbly after US election? Call a lawyer

The phones have been ringing in our Edinburgh office more than usual and the surge in enquiries is down to a rather surprising factor. Step forward Donald Trump, soon to take office as the President of the United States for the second time.

Why on earth is someone seemingly so remote from our daily lives here in the UK causing such a stir with our clients? The simple answer is that we advise a large number of people with assets in the United States and political changes are always a cause for concern, especially when President Trump has already warned the UK that it must choose between the US and Europe.

We need also look no further than our own recent budget - Labour’s first for many years - and the ensuing protests from small businesses and farmers in particular, as evidence of the fears caused by administration changes. It might be scant consolation for those groups, but the budget was generally accepted as not as punitive as many expert commentators had feared.

Don't be tripped up by US law, says Fraser Scott

Professional advisers and their clients like certainty - and change is not always welcome. However, as one of Trump’s presidential predecessors, John F Kennedy, once said: “Change is the law of life.”

On that basis, we just have to adjust and the subtext for anyone with assets here or abroad is make sure you get expert, professional advice. Failing to do so can lead to expensive mistakes.

George Bernard Shaw spoke of “two countries separated by a common language”, which highlighted the fact that words can have starkly different meanings on each side of the Atlantic. In the legal world, US advisors commonly use trust structures to manage estate succession stateside, a familiar concept for Scottish advisors. But the rules and regulations governing the use of trusts in Scotland are very different to those in the US, with far greater flexibility afforded to our American friends.

Similarly, the concept of inheritance tax will be as familiar to those in the US as it is to us in the UK, but the individual thresholds are dramatically different, with the US threshold rising to almost $14 million in 2025 versus our paltry £500,000. Clients formerly domiciled in the US arriving in the UK are often surprised at the extent to which their freedom to control the succession of their personal estates is curtailed, not least by the tax rules.

Given the variety and complexity facing the advisory community, international links are important and online meetings with counterparts across the pond are commonplace for us. With around one million Brits owning overseas properties the legal fraternity’s usual clarion call to put an effective Will in place becomes even more important.

In fact, for those with assets in both the UK and the US, you might find that you need more than one Will, and if you do it is crucial that both documents work in harmony. It is not unknown for a prepared Will in one jurisdiction to accidentally revoke a Will in another jurisdiction.

The solution to these complex matters is actually quite simple – speak to your lawyer. And, in this case, make sure your lawyers speak to each other.

Fraser Scott is a Private Client Partner with Murray Beith Murray