The Government is to launch a consultation on a number of reforms which will affect non-UK domiciled individuals. The proposed reforms include: imposing UK taxation on the worldwide income and gains
The Government is to launch a consultation on a number of reforms which will affect non-UK domiciled individuals. The proposed reforms include:
- imposing UK taxation on the worldwide income and gains of long term UK resident non-doms. This will align the taxation of income and gains with the existing tax treatment of inheritance tax, For all taxes it is proposed that an individual will be deemed UK domiciled once UK resident for more than 15 out of the past 20 years.
- restricting the remittance basis of taxation so that it cannot be claimed by individuals with a UK domicile of origin. This reform is proposed on the assumption that individuals with a domicile of origin in the UK have strong connections with the UK, (which may not actually be the case in view of the adhesive nature of a domicile of origin). If this reform takes place the new £90K remittance basis charge will become redundant for non-doms resident for 17 out of 20 years who will now be taxable on an arising basis after 15 years (there is no change to the £30K and £60K remittance basis charges).
- imposing inheritance tax on UK residential property held by non-doms directly or through excluded property trusts even if the property is held (or “enveloped”) through an offshore structure. This follows the extension of CGT to non-UK residents introduced in the Finance Act 2015. The Government does not propose a de minimis limit and the charge will apply whether or not the UK property is commercially let.