Autumn Statement: Reforms to the taxation of non-domiciled individuals


The UK’s Chancellor of Exchequer delivered his annual Autumn Statement today. As previously announced at the 2015 Summer Budget and following the HM Treasury consultation published on 19 August 2016, the government has confirmed that from April 2017: 

  • non-domiciled individuals will be deemed UK domiciled for tax purposes if they have been UK resident for 15 of the past 20 years, or if they were born in the UK with a UK domicile of origin;
  • inheritance tax will be charged on UK residential property when it is held indirectly by a non-domiciled individual through an offshore structure, such as a company or a trust; and
  • the rules for the Business Investment Relief scheme will be amended to make it easier for non-domiciled individuals who are taxed on a remittance basis to bring offshore money into the UK for the purpose of investing in UK business. 

As previously announced by HM Treasury, the Chancellor has confirmed that non-domiciled individuals who have a non-UK resident trust set up before they become deemed domiciled in the UK will not be taxed on income and gains arising outside the UK and retained in the trust.