Non-dom changes: UK resident with a UK domicile of origin

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Summary: You may have lived overseas for many years, maybe even most of your life but, from April 2017 your worldwide assets (including those held in trust) will be subject to UK tax if you were born in the UK with a UK domicile at birth and are returning to live here. Here we provide a guide to the proposals so you can plan ahead.

From April 2017, an individual born in the UK with a UK domicile of origin, who has acquired a domicile in another country but who returns to the UK to take up  esidence will be treated as UK domiciled as soon as he becomes UK resident. He  ill be taxed on his worldwide income and gains as they arise and after one tax year of residence his worldwide assets (including those held in trust) will be subject to UK inheritance tax.

Sophia, an client example:

  • born in UK with UK domicile of origin
  • non-UK resident since 1982; acquired non-UK domicile of choice in 1985
  • set up offshore trusts in January 2002; she is a beneficiary of the trusts
  • becomes UK resident from 6 April 2017 but intends to return to country of domicile of choice after a few years

A client example: sophia

Expats need to be alert to the proposed changes to tax rules which take effect from April 2017. The draconian rules mean that an expat could find themselves paying UK income tax and capital gains tax and exposed to inheritance tax on their worldwide assets if they return to the UK, even temporarily.
Marilyn McKeever, Associate Director - Private Client

Read more about your tax position once a UK resident.

Download our guide >

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