From 6 April 2025, a new regime for the taxation of UK-resident non-domiciled individuals came into effect. HMRC has published a brand-new manual on the regime, which can be viewed here.

Up to 5 April 2025, special tax rules applied to individuals who were resident in the UK but whose domicile (i.e. their permanent home, usually determined by their father’s permanent home at the time the individual was born) was outside the UK. These individuals could choose either to pay UK tax on their foreign income and gains as they arose, or to claim the remittance basis—meaning only foreign income and gains brought into the UK were subject to tax.

From 6 April 2025, all UK residents will be taxed on the arising basis of assessment. The remittance basis will no longer be available. A new regime for Foreign Income & Gains (FIG) will apply to individuals during their first four years of UK tax residence following a period of 10 years’ non-residence. Individuals who claim under the new 4-year FIG regime will not be taxed on FIG arising within that period. Former remittance basis users will continue to pay UK tax on FIG that arose before 6 April 2025 if and when those amounts are remitted to the UK.

New rules also apply for Inheritance Tax (IHT). The new test for determining whether non-UK assets fall within the scope of IHT is based on whether an individual has been resident in the UK for at least 10 out of the 20 tax years immediately preceding the tax year in which the chargeable event (including death) occurs. This is referred to as being a ‘long-term UK resident’. If an individual is a long-term UK resident and subsequently becomes non-UK resident, they will remain within the scope of IHT for a minimum of three years and up to a maximum of ten years, depending on the duration of their UK residence.