The End of Non-Dom Status: What UK Residents Must Do Now

One of the most significant reforms in a generation: from April 2025, claiming the remittance basis on overseas income is no longer possible. The UK has moved to a fully residence-based system, affecting tens of thousands of internationally mobile individuals - particularly NRIs, expats, and those with complex cross-border financial arrangements.

What has changed - and what has not

The Four-Year FIG Regime in detail

The Foreign Income and Gains (FIG) Regime is the new arrival's replacement for non-dom status. If you have not been UK resident in any of the ten tax years preceding the current one, you qualify for the regime automatically. During the four-year period, you can bring overseas income and gains to the UK freely - without a UK tax charge - and you do not need to report that overseas income on your Self Assessment return.

Critically, you must actively claim the FIG Regime on your Self Assessment return each year. It is not applied automatically. Failure to claim means you are taxed on your worldwide income from day one. If you arrived in the UK in April 2022 and have not claimed the FIG Regime, you should take immediate advice on whether late claims or amendments are possible.

The Temporary Repatriation Facility (TRF)

The TRF is arguably the most important transitional provision for former non-doms with significant offshore wealth. It provides a three-year window - running from April 2025 to April 2028 - during which previously protected overseas income and gains can be remitted to the UK at a reduced flat rate of 12%.

This is a significant discount compared to the income tax rates that would otherwise apply (up to 45%). For individuals sitting on large offshore pools of income that was previously untaxed on the remittance basis, the TRF may be the most cost-effective route to repatriating those funds, particularly if the money is needed for UK investment or property.

The 12% rate applies to the gross amount remitted. There is no deduction of the original charge to the Annual Remittance Basis Charge that may have been paid historically. The facility closes permanently on 5 April 2028 - there will be no extension.

Rebasing of overseas capital assets

Individuals who were non-UK domiciled and claimed the remittance basis at any point between 6 April 2017 and 5 April 2025 can elect to rebase certain overseas assets to their market value on 5 April 2017 for Capital Gains Tax purposes. This means only gains accruing after April 2017 are within the UK CGT charge - gains before that date are effectively wiped.

The rebasing election must be made on your Self Assessment return and applies on an asset-by-asset basis. For individuals who have held overseas investment portfolios or property for a long time, the rebasing election can substantially reduce UK CGT on future disposals. Obtaining accurate April 2017 valuations now - while records and market data are available - is strongly advisable.

IHT changes: the 10-year test

The concept of "domicile" for IHT purposes has been replaced from April 2025 with a new long-term UK residence test. You become subject to UK IHT on your worldwide assets once you have been UK resident for 10 out of the previous 20 tax years. You remain within the scope of UK IHT for 10 years after leaving the UK if you reached long-term resident status.

This is a significant change for internationally mobile individuals who were previously able to remain non-UK domiciled - and therefore outside the scope of UK IHT on overseas assets - indefinitely. The 10-year clock starts from April 2025 for individuals already in the UK, meaning those who arrived before 2015 are already within the scope of the new rules.

Who is most affected?

The individuals with the most urgent need to take action are those who: have been UK resident for more than four years and were relying on non-dom status to shelter overseas income; have significant offshore pools of income or gains that could be repatriated via the TRF; hold overseas property or investment portfolios with large unrealised gains that could benefit from rebasing; or are approaching the 10-year IHT residency threshold and should consider whether leaving the UK before that point makes sense for their circumstances.