Non-UK domiciled individuals

Individuals coming to the UK from overseas often have a more favourable tax position because of their domicile position. Careful, pre-arrival planning to establish your expected domicile and residence status can significantly reduce your exposure to UK tax.

Non-UK domiciled individuals (non-doms) can benefit from special rules in the UK which enable them not to be taxed on a worldwide arising basis, but only on monies remitted to the UK. This potentially leads to tax savings.

In recent years successive governments have made changes to the non-dom rules, in order to clamp down on those individuals not perceived to be contributing as much as they should to the UK tax system. This area of tax is therefore becoming increasingly complex to navigate and new rules from 6 April 2017 will make this even more difficult. 

Your domicile status will be a factor in determining your liability to income and capital gains tax. It is also the only significant factor in determining your liability to inheritance tax. To avoid unnecessary tax costs, it is important, therefore, to understand your domicile status and the tax implications that result from it. 

There are plenty of opportunities for tax-efficient planning for non-doms, including the use of overseas trust and company structures. In particular, the government has set out opportunities to re-organise affairs prior to the new rules coming in on 6 April 2017, but in order to take advantage, action will be needed well in advance.

RSM can assist you with UK tax planning in relation to your time in the UK. We have a wealth of experience in providing tax advice in this area, and our clients typically benefit from:

  • domicile reviews;
  • pre UK entry and exit tax planning;
  • Investor visa tax planning;
  • analysis of remittance basis versus arising basis;
  • bank account segregation planning and analysis, including keeping clean capital and dealing with mixed funds;
  • remittance basis planning, including funding requirements in the UK;
  • non-dom to UK-dom spouse elections;
  • UK remittances into UK companies under the business investment relief scheme;
  • deemed domicile and inheritance tax planning; and
  • UK tax compliance.

It is important that non-UK domiciled individuals who are considering a move to the UK obtain tax advice ahead of their arrival. Make sure you contact a specialist at the earliest possibility. At RSM, we could discuss with you how we can help, so please do not hesitate to get in touch with us.

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