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Living Partly Abroad? How the FIG Regime Replaces Domicile for New UK Residents
From 6 April 2025, UK’s Foreign Income and Gains (FIG) regime replaced the remittance basis and old domicile rules. Qualifying new residents enjoy relief, but must comply with the statutory residence test—here’s how to plan.
By NomadicTax Research Team • 5-8 min read • September 16, 2026
## What is the FIG Regime & Why It Matters
The **Foreign Income and Gains (FIG) regime** came into effect on **6 April 2025**, replacing the remittance basis and the concept of domicile. Under the FIG regime, **all UK residents** are taxed on an **arising basis** meaning on worldwide income and gains, but **‘qualifying new residents’** can claim relief on foreign income and gains incurred during their first **4 years** of UK residence.([gov.uk](https://www.gov.uk/government/publications/foreign-income-and-gains-fig-regime-self-assessment-helpsheet-hs266/hs266-foreign-income-and-gains-fig-regime-2026?utm_source=openai))
To be a qualifying new resident you must:
- Have **been non-UK resident** for at least **10 consecutive tax years** before coming to the UK, and
- Be within your first **4 UK tax years of residence**, and
- Not be a member of **Parliament** or the **House of Lords**.([gov.uk](https://www.gov.uk/government/publications/foreign-income-and-gains-fig-regime-self-assessment-helpsheet-hs266/hs266-foreign-income-and-gains-fig-regime-2026?utm_source=openai))
Residence is determined using the **Statutory Residence Test (SRT)**.([gov.uk](https://www.gov.uk/government/collections/uk-tax-residence-guidance?utm_source=openai))
## Interaction with the Statutory Residence Test (SRT)
The SRT is used to assess whether you’re tax resident in the UK, based on automatic tests, UK presence, and ties to the UK. It governs how the FIG regime applies.([gov.uk](https://www.gov.uk/government/publications/rdr3-statutory-residence-test-srt?utm_source=openai))
If you pass the SRT in your arrival year, you may only get **partial year treatment** via the **split-year rule**, depending on when you moved and settled. Otherwise, full tax year treatment may apply.([gov.uk](https://www.gov.uk/government/publications/foreign-income-and-gains-fig-regime-self-assessment-helpsheet-hs266/hs266-foreign-income-and-gains-fig-regime-2026?utm_source=openai))
## Examples: How This Works in Practice
- **Sarah**, non-resident for 12 years, moves to London in May 2026. Her tax years of UK residence begin 6 April 2026, so her first 4 UK tax years are 2026-27 through 2029-30. Her foreign income earned after 6 April 2025 *before* UK residence begins is potentially eligible for relief if under FIG, depending on timing.
- **Carlos**, arriving in UK on 1 January 2025 after being abroad for 15 years, becomes a qualifying new resident from the 2025-26 year. Foreign gains/income during his first 4-year window can be sheltered subject to the FIG rules.
- **Emma**, who is in the House of Lords, is **ineligible**, even if she otherwise meets qualifying income and absence conditions. FIG relief does not apply.
## Practical Planning & Compliance Tips
- Keep detailed **dates of arrival and residence**, travel logs, and connections (family, work, property) to determine SRT status precisely.
- Maintain records of foreign income/gains—source, amounts, dates—so that when claiming relief under FIG you have proof.
- Consider timing major foreign income or disposals in years when you’re a qualifying non-resident or in early qualifying years.
- Seek advice if relying on split-year treatment, as it can significantly affect your taxable period and relief eligibility.
## Risks & Considerations
- If you misjudge your residence status with the SRT, you may pay UK tax earlier than anticipated.
- FIG doesn’t apply forever—after your first 4 years residency the relief ends and you’ll be taxed on foreign income/gains arising after that.
- RULE: House of Lords / Commons membership disqualifies you from claiming FIG relief. Know your status.
## Conclusion
The FIG regime represents a major change in the UK-tax landscape, especially for those used to domicile and the remittance basis. If you're moving to or returning to the UK after many years abroad, **make sure to assess your eligibility and plan your foreign income**. Correct timing, documentation, and understanding residence rules can help you maximise relief and avoid unexpected tax liabilities.