If you or your clients have relied on the UK’s non-domiciled (“non-dom”) tax status, a major tax shake-up is on the horizon. The longstanding non-dom rules, a key feature of the UK tax landscape, will be scrapped from 6 April 2025.
These sweeping reforms, part of the Finance Act 2025, will alter how international individuals and families living in the UK are taxed.
Whether you’re currently a non-dom, thinking of relocating, or holding assets offshore, these changes demand your attention and timely action.
Below, we break down the key reforms, reliefs, and crucial next steps.
Remittance Basis – Ending After 2024/25
For decades, non-doms could choose to be taxed only on income and gains sourced in the UK or on foreign income and gains only when brought into the UK. This “remittance basis” will disappear after 5 April 2025.
From 6 April 2025, all UK residents will pay tax on worldwide income and gains as they arise, regardless of domicile. The exception? Only a few narrow categories will avoid this rule.
What this means for you:
- The final year to claim the remittance basis is 2024/25.
- From 2025/26, everyone resident in the UK is taxed on an arising basis.
- Pre-2025/26 unremitted foreign income/gains remain subject to remittance rules — meaning if you bring them into the UK later, old rules still apply.
A New Welcome Mat: Relief for “Qualifying New Residents”
To soften the blow for international talent, a new relief offers a temporary tax break for newcomers, or returners, to the UK.
How it works:
- You must have been non-resident in the UK for at least 10 consecutive tax years.
- If eligible, you’ll enjoy up to four years of exemption on foreign income and gains.
- Unlike the old regime, there’s no domicile requirement – making this an attractive option for returning UK nationals too.
- However, you won’t be entitled to claim UK personal allowances or some reliefs during the exempt period.
Bringing Money Home: The Temporary Repatriation Facility (TRF)
If you’ve previously used the remittance basis, you’ll want to know about the Temporary Repatriation Facility. This offers a chance to bring foreign income and gains into the UK at a reduced tax rate – but only for a limited window.
Key points:
- Available 2025/26 to 2027/28.
- Qualifying remittances taxed at 12% for the first two years, rising to 15% in the final year.
- The existing rules on categorising remittances still apply – meaning pre-arrival capital remains non-taxable if remitted.
- Only available to those who previously claimed the remittance basis.
- Foreign taxes already paid may impact your net UK tax position, so careful analysis is a must.
Capital Gains – Foreign Asset Rebasing Opportunity
If you’ve used the remittance basis at any point from 2017/18 to 2024/25, you may benefit from a rebasing of foreign assets for capital gains tax (CGT).
What you need to know:
- Assets held on 5 April 2017 can be rebased to their market value on that date.
- Applies automatically unless you choose to opt out.
- Could reduce your CGT liability when selling foreign assets post-6 April 2025.
Offshore Trusts – End of Existing Protections
One of the biggest shifts affects offshore trusts. Up to now, certain offshore trusts set up by non-doms enjoyed favourable tax treatment on foreign income and gains.
From 6 April 2025, those protections vanish.
Key impacts:
- UK resident settlors will be taxed on all income and gains of non-UK resident trusts as if they owned them directly.
- Beneficiaries of trusts set up by non-resident settlors will remain taxable on distributions received.
- Pre-2025/26 income and gains will still benefit from transitional protections.
Inheritance Tax (IHT) — From Domicile to Residency
A radical change to UK Inheritance Tax (IHT) rules sees the concept of domicile replaced with a residency-based test.
From 6 April 2025, IHT will apply based on whether you’ve been UK resident for 10 out of the past 20 tax years.
Implications include:
- Your worldwide assets could be subject to UK IHT once you hit the 10-year threshold.
- Some treaties (notably with the US) may shield certain individuals.
- Provides clearer rules for estate and succession planning.
Transitional Measures and Anti-Avoidance Provisions
The government has introduced several transitional rules, along with anti-avoidance measures, to smooth the shift and prevent tax avoidance strategies.
Whether it’s managing existing structures, planning repatriation, or dealing with foreign gains, these measures will be crucial to understand.
Summary of the New Landscape
| Change | Effective From | Summary |
| End of Remittance Basis | 2025/26 | Worldwide income/gains taxed for all UK residents |
| Temporary Repatriation Facility | 2025/26–2027/28 | Reduced tax rates on bringing in old foreign income/gains |
| Rebasing of Foreign Assets | From 6 April 2025 | CGT relief for qualifying foreign assets held as of April 2017 |
| Relief for New Residents | From 2025/26 | 4-year foreign income/gains exemption for new long-term arrivals |
| Offshore Trust Protections Removed | 2025/26 | Trust income/gains taxable on UK resident settlors |
| IHT Residency Test | From 6 April 2025 | IHT applied after 10 years’ UK residence |
What Should You Be Doing Right Now?
This overhaul of the UK tax rules is nothing short of seismic for globally mobile individuals and families. The potential impact on your wealth, structures, and succession planning could be significant.
We strongly recommend you act now to:
- Review offshore trusts and wealth structures
- Consider using the TRF before the window closes
- Assess whether rebasing your foreign assets is right for you
- Prepare for UK IHT exposure based on residency rules
At Williamson & Croft, we specialise in providing tailored, proactive advice for high-net-worth individuals, international families, and globally mobile professionals.
Contact our expert team today to discuss your personal position and how we can help you navigate the post-non-dom world with confidence.