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How Non-UK Residents and Former ‘Non-Doms’ Should Navigate the FIG Regime
Since 6 April 2025, the UK has replaced the remittance basis with a residence-based tax system. Learn whether you qualify for the 4-year Foreign Income & Gains (FIG) relief and how overseas trust distributions and IHT rules have shifted.
By NomadicTax Research Team • 5-8 min read • March 27, 2026
## Key policy overhaul: What changed since April 2025
The UK’s tax treatment for individuals arriving from abroad or previously non-domiciled has fundamentally changed:
- **Remittance basis abolished**: replaced by a **residence-based system**, removing domicile as a key factor. ([gov.uk](https://www.gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals/technical-note-changes-to-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai))
- **FIG (Foreign Income & Gains) regime**: New arrivals who weren’t UK residents for 10 consecutive years prior can qualify for **100% relief** on foreign income & gains brought into the UK during their **first four tax years of residence**. ([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: from 3 to **4 years**, subject to residence criteria and financial caps. No more need to keep employment income offshore if eligible. ([gov.uk](https://www.gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals/technical-note-changes-to-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai))
## Inheritance Tax (IHT) and overseas assets
- The shift is from a **domicile-based to a residence-based system** for IHT. Long-term residents (10 of the last 20 tax years) may be liable on their *worldwide assets* when the new rules apply. ([gov.uk](https://www.gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals/technical-note-changes-to-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai))
- Settlements (trusts) created by non-UK domiciled or formerly domiciled individuals after 6 April 2025 may bring non-UK assets into charge under IHT depending on residence criteria and the “tail” period after leaving the UK. ([gov.uk](https://www.gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals/technical-note-changes-to-the-taxation-of-non-uk-domiciled-individuals?utm_source=openai))
## Actionable advice for affected individuals
- **Check your residence history and arrival date**: Did you become UK resident after long non-residence? If yes, you might be in the FIG regime.
- **Calculate eligible foreign income and gains**: Foreign income/gains pre-6 April 2025 may still be relevant via reduced-rate Temporary Repatriation Facility (TRF). TRF includes gains and income in 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))
- **Consider employment arrangements**: For OWR eligibility, ensure income and employment conditions are satisfied; claim relief where possible.
- **Review estate planning**: If you are, or will be, a long-term resident, assess how the residence-based IHT rules affect your assets and trusts.
- **Trustees beware**: Distributions from overseas trusts may now be taxed on arising basis, not just when remitted. Plan trusts accordingly. ([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))
## Practical example
James moved to the UK on 1 May 2025 after 15 years abroad. He holds rental income overseas and had assets in foreign trusts.
- He qualifies for the **FIG regime** (first eligible resident year in 2025-26).
- Gains accrued in trusts pre-6 April 2025 fall under TRF at reduced rates. After that, trust income arises basis applies.
- If James has already assets outside UK worth £5 million: under residence-based IHT, he may need to include them depending on residence tenure (10 of 20 rule).
## Pitfalls & common misunderstandings
- FIG relief is **not automatic**—you must opt in and meet criteria.
- Foreign income/gains “brought into the UK” includes remittances, but tax on non-UK gains may trigger even if you don’t physically bring money home.
- The new rules don’t give past REBs for all foreign income—only limited relief for some pre-6 April 2025 income via TRF.
## Bottom line
If you're or were a non-UK domiciled individual, or new to UK residence, you must understand how the **FIG regime, OWR, and new IHT rules** interact. With careful planning of arrival dates, trust structures, and income remittances, you can optimise tax exposure under these changes.