Publication
Changes to non-dom status in the UK: requirements and procedure
The UK is making significant changes to its famous non-domiciled tax regime. In this article, we, the Antwort Law team, will take a detailed look at which elements of this regime remain unchanged and which changes should be considered.
Former conditions for the status of "non-dom"
The "non-domiciled" regime allowed UK residents to pay tax only on income transferred to the country. In order to receive the status of "non-dom", it was necessary to meet the following criteria:
1) Place of birth and residence:
- You were not born in Great Britain.
- Your original place of residence (domicile) was not in Great Britain.
2) Tax resident status:
- You were not resident in the UK in the 2017-2018 tax year or later.
- Have you not been resident in the UK for at least 15 of the last 20 years preceding the relevant tax year.
There is no procedure for officially acquiring the status of "non-dom", it is enough to indicate it in the tax declaration. This status is maintained as long as all its conditions are met, and it cannot be "lost" in the usual sense. However, you can temporarily not use this status by choosing the "Arising Basis" tax regime, which provides for the payment of taxes on all worldwide income according to the usual scheme.
Changes in "non-dom" mode
From April 2025, significant changes to the 'non-dom' regime are coming into force in the UK. If you join this mode after this date, the following innovations await you:
- Statutory Residence Test: After passing this test, which determines your tax status in the UK, you will need to meet certain criteria to benefit from non-dom status.
- Ten-year non-domicile period: To qualify for this status, you must not have been UK tax resident for at least ten consecutive years before applying for non-domicile status.
- Best of all, a four-year tax exemption: if you meet the criteria above, you'll get 100% UK tax exemption on your foreign income and capital gains for the first four years of your UK residency.
This includes income earned abroad and any capital gains made outside the UK.
What remains unchanged:
Basic Domicile Criteria: You must still be a non-UK resident by birth and have an original residence outside the UK.
Simplified declaration system: "non-domicile" status can still be indicated in the tax return without the need to go through a separate procedure.
The ability to choose a tax regime: you can temporarily not use the status of "non-domicile" and choose the regime "Arising Basis" for paying taxes on worldwide income.
Changes to the non-domiciled tax regime in the UK are aimed at strengthening controls and preventing tax evasion, but with good planning it is possible for UK non-residents to manage their tax obligations effectively. Antwort Law is ready to help you understand these changes and ensure you are compliant with your tax status.
For more detailed consultation and assistance in adapting to the new conditions of the tax regime, contact us.
Lidia Ivanova
International lawyer
Antwort Law
Actual Services
FAQ
What are the main changes to the non-dom regime that will come into force from April 2025?
From April 2025, there are three key changes to the UK non-dom regime:
Requirement to pass the Statutory Residence Test.
Requirement to not be UK tax resident for ten consecutive years before applying for non-dom.
Introduction of a four-year tax exemption on foreign income and capital gains.
What remains unchanged in non-dom mode?
The basic criteria for domicile remain unchanged: you must be a non-UK resident by birth and have your original place of residence outside the UK. The simplified system for declaring non-dom status on your tax return and the option to choose the "Arising Basis" tax regime also remain.