How have the tax rules for non-UK domiciled individuals changed from April 2025?

In April 2024, The Chamber, in partnership with TaxAssist in the UK and Nexia Australia, hosted a webinar and Q&A covering the UK Government's proposal to replace the taxation of UK non-domiciled with a residence-based regime.

These changes will have wide ranging implications for many Australians and nationalities living in the UK.

What has changed

From 6th April 2025, the current taxation rules for non-UK domiciled individuals will change and the UK will switch to a residence-based tax regime for income tax, capital gains tax (CGT) and inheritance tax (IHT).

Will this affect me?

These changes will affect Australians and other nationalities living in the UK who currently make use of the remittance basis of taxation as well as affecting protected trusts and excluded property reliefs.

Key points to be aware of

In summary, from 6th‌‌‌ April‌‌‌ 2025, the current rules for the taxation of non-UK domiciled individuals will be reformed:

• a new residence-based regime will apply and provide full relief on eligible foreign income and gains (FIG) for qualifying new arrivals to the UK in their first four years of tax residence
• a new Temporary Repatriation Facility (TRF) may be relevant for individuals who previously made use of the remittance basis to designate pre-6‌‌‌ April‌‌‌ 2025 FIG amounts for a period of three tax years and take advantage of a reduced tax rate. The tax rate will be 12% for the first two years and 15% for the third year.
• Overseas Workday Relief (OWR) will still apply but be subject to transitional rules

What can I take away

Affected Australians and other nationalities living in the UK should consider reviewing their worldwide assets and investments and be aware these changes could impact any offshore structures and global mobility options relevant to their circumstances.

There will also be opportunities to consider whether they should take advantage of the new Temporary Repatriation Facility, designed to allow non-UK domiciled individuals to bring funds to the UK at a special rate.

Download our free guide

For more information about the tax changes for non-UK domiciled individuals click here to download our free guide.

Last updated 8 Apr 2025 | First published 8 Apr 2025

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This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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