6th April non-dom tax changes – where are we now?

Friday 28 April 2017

By Glenn Cassidy, Senior Tax Consultant, Equiom Solutions

Further to our earlier communication about the UK tax changes first proposed in July 2015, on 25 April 2017 the UK Government announced that a number of the tax changes included in the 2017 Finance Bill would be removed.

The clauses dropped from the Bill include:

  • Inheritance Tax on UK residential property - Owned by offshore structures and loans made to acquire or improve UK residential property including those loans made by individuals, companies and trustees.
  • Long-term deemed domicile - The revised deemed domicile rules, the changes to the remittance basis of taxation for non-doms and the taxation of trusts created by non-doms.
  • Returning non-domicile rules - People born in the UK with a UK domicile of origin who had become non-UK domiciled but subsequently become resident in the UK were to be deemed domiciled for IHT, Income Tax and Capital Gains Tax purposes.

 

It is possible the clauses removed will reappear later in the year in a future 2017 Finance Bill and be effective, as originally planned, from 6 April 2017. It is also possible that the delay could push back the effective date to 6 April 2018 but the expectation of this happening is low. While the future implementation of these changes may be dependent on a Conservative Government continuing in power, it is likely that these changes will become effective in one form or another.

What action is required?

In the short term it is suggested that no action is taken and we would hope some clarity should emerge post 8 June and, whilst far from certain, it is possible there could be a further ‘window of opportunity’ for individuals to restructure their affairs.

We will keep you posted on future developments in this area.


Contact

If you have any questions or would like to discuss your situation with one of our tax team, please contact Glenn Cassidy.