The UK government is replacing the remittance basis tax regime available to non-domiciled individuals (the “Non-Domiciled Regime”) with a new Foreign Income and Gains tax regime.
The Non-Domiciled Regime has its roots in legislation dating back to the Napoleonic wars. It allowed individuals domiciled outside of the UK to exempt their overseas income and gains from UK tax as long as they didn’t “remit” them to the UK (that is, they didn’t either use them or move them to the UK).
This is known as the “Remittance Basis” and was restricted to individuals who were not “domiciled” in the UK.
(“Domicile” is a complex notion, relating to where a person is most closely connected and becomes irrelevant under the new rules).
The current reform of the Non-Domiciled Regime was originally introduced by the Conservative Government in the Spring 2024 Budget. The Labour Government have since announced its amendments to the regime in the recent Autumn 2024 Budget.
The non-domiciled rules that have applied up to and including 2024/25 UK tax year will be abolished with effect from April 2025.
Want to find out how to respond to this change? Read our full insights article.
