Clients are often surprised when they leave a gift to a foreign charity in their Will and are told that, under the UK Inheritance Tax regime, they will not get tax relief for the gift. This is a long-standing issue and, as people become more internationally mobile, it is becoming more controversial. HMRC have long argued that they cannot scrutinise foreign charities to make sure they are, in fact, for purposes that would be charitable under English law. One counter-argument was that, for charities established in EU countries, the right to free movement of capital means that foreign charities have to be treated the same as UK charities under UK tax legislation. That argument has just been squashed by the Court of Appeal in the case of Routier v HMRC however. This decision confirms that, if you want a charitable gift in your Will to be exempt from Inheritance Tax (or taken into account in getting the lower 36% rate) you have to select a UK Charity.