One-third of Non-Dom Thinking of Leaving The UK. Why?

A huge number of non-domiciled residents are planning to leave the UK because of changes to tax rules and the abolition of the non-dom status.

The previous Conservative government first announced the changes, and the current Labour government has built on them.

Why Are Non-Dom Leaving the UK?

One of the major changes that the non-dom is concerned about is the global Inheritance Tax liability with a 10-year reach even after departing the UK. This, along with the general perception that they will end up paying higher taxes across multiple fronts, may end up causing their flight.

Of all the respondents who participated in a survey by Oxford Economics:

•  79% of non-domiciled investors responded they would not have chosen to come to the UK if this policy had been in place earlier.
• 83% of the non-dom cited the new global Inheritance Tax (IHT) as their reason for looking to leave the UK.

Experts’ Concerns

Experts have said that there is a high possibility of a decrease in the number of new non-dom clients since the announcement of the changes. If this happened, it could lead to a great loss in tax revenue as well as a negative impact on many areas.

What is Non-Dom Status?

The non-dom status is for individuals who are residents in the UK but have permanent homes outside the country. This status provides certain tax benefits for non-domiciled individuals, which makes this tax regime attractive, especially for wealthy taxpayers. 

Conclusion

The abolition of the non-dom status and new tax rules in the UK may push non-domiciled individuals out of the UK, which could result in major losses in tax revenue.