Tax Planning
How Non-UK Domiciled Individuals Should Navigate the UK’s New Residence-Based Tax Regime
From 6 April 2025, their tax status shifts—non-UK domicile is replaced by residence, and the remittance basis abolished. Here's what you need to know and do.
By NomadicTax Research Team • 5-8 min read • November 23, 2025
## What’s Changing for Non-UK Domiciled Individuals
From 6 April 2025, the UK will **end the remittance basis of taxation**. Instead, a new **residence-based regime** will take effect. Non-UK domiciled individuals, whether moving to the UK or already resident, will be taxed on their **worldwide income and gains as they arise**, with certain transitional reliefs in place.([gov.uk](https://www.gov.uk/government/publications/tax-changes-for-non-uk-domiciled-individuals/reforming-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai))
## Key Elements of the New Regime
| Feature | Details |
|---|---|
| **4-Year Foreign Income & Gains Regime (FIG)** | Qualified new UK residents will receive 100% relief on foreign income and gains for their first 4 years, provided they were not UK tax residents in the previous 10 years.([gov.uk](https://www.gov.uk/government/publications/tax-changes-for-non-uk-domiciled-individuals/reforming-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai)) |
| **Temporary Repatriation Facility (TRF)** | Individuals who used the remittance basis will have three years (2025-26, 2026-27, 2027-28) where foreign income or gains accrued before 6 April 2025 can be remitted at 12% for the first two years, 15% in the third.([gov.uk](https://www.gov.uk/government/publications/tax-changes-for-non-uk-domiciled-individuals/reforming-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai)) |
| **Overseas Workday Relief (OWR)** | Extended to 4 years (with limits): lower of £300,000 or 30% of employment income. Employers’ obligations simplified regarding PAYE directions.([gov.uk](https://www.gov.uk/government/publications/tax-changes-for-non-uk-domiciled-individuals/reforming-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai)) |
| **Inheritance Tax (IHT) changes** | Moves toward residence-based scope: “long-term resident” individuals (10 out of 20 tax years) will be within IHT on non-UK assets. Trusts and deemed domicile no longer grant same protections.([gov.uk](https://www.gov.uk/government/publications/tax-changes-for-non-uk-domiciled-individuals/reforming-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai))
## Who’s Most Affected
- New arrivals to the UK who enjoy non-UK domicile status.
- Former non-UK domiciliaries already in the UK considering their options.
- Employers hiring foreign workers and trustees of settlor-interested or other trusts.([gov.uk](https://www.gov.uk/government/publications/tax-changes-for-non-uk-domiciled-individuals/reforming-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai))
## Transitional Action Steps
1. **Audit your assets and past income/gains** before 6 April 2025 to see what falls under TRF.
2. **Determine if you qualify for the 4-year FIG regime**—do you meet non-resident status for 10 prior years?
3. **Review trust arrangements**: the treatment of trusts changes substantially.
4. **Employer interactions**: check whether PAYE directions can be simplified under the new rules for overseas work.
5. **Estate and inheritance planning**: with IHT moving to residence basis, tie up estate, gift, trust plan accordingly.
## Practical Example
**Case**: Maria, a software consultant, moves from Brazil to the UK on 1 May 2025. She was non-resident for the past 12 years.
- Maria qualifies for the 4-year FIG. Her foreign consulting income between 6 April 2025 – 5 April 2029 can be brought into the UK and remain untaxed under FIG, provided conditions met.
- Income accrued **before** 6 April 2025 can be remitted via TRF: in year 1 at 12%, year 2 same, then 15% in year 3.
- If she owns foreign assets via trust, distributions/gains may now be taxable on arising basis unless trust meets certain thresholds.
- Her non-UK property may also become subject to UK IHT once she meets the “long-term resident” criteria (10 of 20 years).
## Advice to Act Now
- Prepare an inventory of all foreign income/gains and assets.
- Look at structuring trusts or overseas investments before the transition date.
- Consult a UK tax advisor experienced with non-dom rules.
- Keep detailed records—especially around dates of residency and amounts accrued.
- For growing individuals with international income, plan your UK arrival date and income flows to maximize eligibility for reliefs.
These changes are major. With careful planning, individuals can benefit from reliefs; without action, tax exposure could be heavy.