The abolition of non-dom tax status raises a complex web of transitional measures, while the outcome of the election could see Labour take a different approach, warn Katharine Arthur, partner, and Duncan Cleary, senior manager, haysmacintyre
In his Spring Budget last month, the Chancellor announced his proposals for reforming the beneficial non-dom regime, rather stealing the Shadow Chancellor’s thunder in the process.
Removing or at least reducing the benefit of the non-domicile regime had been one of the Labour Party’s key pledges and an important source of funding for their spending plans.
After Jeremy Hunt beat them to the punch, Labour have had to reformulate their plans, but more on that later. First it seems sensible to turn to the current government’s proposals and how these will impact taxpayers.
Individuals who opt into the new regime will not pay UK tax on any foreign income and gains (the new FIG regime) for the first four years they are UK tax resident, so long as they have not been a resident for tax purposes in the last 10 years. After these first four years, individuals will then be liable to pay UK tax on FIG.
