New non-domicile regime opens attractive tax opportunities for returning expats

Changes to the non-domicile regime expected to be confirmed in this month’s Budget will offer unexpected tax planning opportunities for UK expats wishing to return to the UK, say our accountants at James Cowper Kreston.

Following announcements first suggested by the Conservative government and now scheduled to take effect from April 2025, called the Foreign Income and Gains Regime (FIG), expats who meet certain conditions can bring worldwide assets and income into the UK with no UK tax implications for four years.

Amy Virk, Director in our International Tax team, highlights that FIG offers tax planning opportunities for the UK’s large expat community.

The proposed FIG Regime marks a major departure from the current non-domicile regime that restricts the ability to bring overseas assets and income into the UK under the remittance basis.

“If, as is widely expected, the FIG regime is confirmed on 30 October in the first Labour Budget, it will allow individuals to return to the UK and bring into the country income and assets held overseas without any tax implications for a four-year window.

“It is a generous regime and offers returning expats an attractive tax planning window. It could, for example, provide opportunities for business owners looking to realise a gain from an overseas business without incurring tax in the UK.

“To qualify, expats must have been non-UK resident for at least 10 years and re-start their UK residence status. After the four-year window, worldwide assets will fall into the UK tax landscape as normal.

“The international tax landscape remains complex, and consideration will be needed in all jurisdictions where assets are held. Professional advice is a must.” 

If you wish to discuss this further, please contact one of our International Tax team members.