Although UK domiciled and UK deemed domiciled individuals are subject to inheritance tax (IHT) on their worldwide assets, individuals who are not UK domiciled are only exposed to tax on UK situs assets.
There is a common misconception that all UK bank accounts are therefore potentially subject to IHT but this is not always the case. Section 157 IHTA 1984 specifically excludes accounts denominated in a non-sterling currency where they are held by a non-UK domiciliary who is also not UK resident.
However all offshore bank accounts are non-UK situs assets for all non-UK domiciliaries, even if they are denominated in sterling.
This is a handy point to know for individuals who have left the UK. They often have all kinds of reasons for wanting to continue to use their long-standing UK banks, including asset protection. Also offshore accounts can in practice be quite time-consuming and difficult to set up
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