Non-Dom Furore

Recent publications have shown that non-domiciled individuals (commonly referred to as non-doms) have contributed significantly more to the UK economy over the last few years.
 
Stamp duty land tax, ATED charges and the non-dom remittance basis charge have all increased significantly for this group. A large proportion of the UK’s annual stamp duty land tax receipts now come from this group, because of the change to the banding system. All of these changes have together significantly increased the UK’s reliance on tax raised from this single group.
 
Non domiciles typically spend significant amounts of time travelling and because of this find it easier to move residence. So there is a very significant probability that at some point some non-doms will reach a tipping point where residence elsewhere is more attractive.
 
The last budget changes to the annual remittance basis charge saw a reduction in the numbers I have seen claiming this status simply because the charge exceeded its benefits. A removal of non-dom rules would have far greater implications and would as a result trigger a more significant review and by a greater number of people. It is for this reason that comments have been made that the UK may not increase its tax receipts if these changes take place, indeed the opposite may actually happen.
 
The Isle of Man as well as Ireland, if business needs an onshore base, are all attractive places for non-domiciles. So there are plenty of alternatives to the UK which can mean that it can be possible to leave the UK but at the same time continue to spend time in the UK should these changes happen. The ability to run businesses from these jurisdictions as well as flight connections, with the UK and worldwide, as well as common language/legal systems means a move is not that difficult to do from a business perspective. Top class schooling and plenty for the family to do also helps.
 
Any changes like these take time to plan. So now is probably the time to start thinking about what to do if these changes happen. Even if the changes do not take place it is a good reason to revisit existing arrangements to make sure that everything is still being run in an optimal and cost effective fashion. It is spring time after all.

©2017 Middleton Katz Chartered Secretaries LLC is licensed by the Isle of Man Financial Services Authority

Log in with your credentials

Forgot your details?