Non-Domiciled (Non-Dom) Tax Advice

The Non-Domiciled tax regulations are very popular among our wealthy EU citizens and global partners. This is mainly because non-UK individuals residing outside the UK can avoid paying taxes on their overseas income, as long as that income is not "remitted" to the UK. Fundamental to this, is the finer differentiation in the UK tax laws between 'residents' and 'domiciles'. If you are not of British descent, you can indeed be a 'resident' in the UK, but without being classified as 'domicile'.

Fee: £250 for an one hour telephone consultation with an expert, scheduled within one week

 

No world income tax-base for foreigners in England

Have you ever wondered why so many wealthy people from all over the world move to London? It isn't only for the restaurants and the football! It is more likely because they avail themselves of the special legal regulations and arrangements of 'Non-Domiciled' taxation,  or to use the the British colloquialism, the 'Non-Dom' arrangements.

Example: A wealthy Russian is living in London. His oil company in Siberia is making millions in profits every year. He is not paying any tax on this income – he remains tax-free.

Do you find this interesting? Please bear in mind that this is a very basic example, and there are of course many stipulations. Additionally, there have been recent changes in regulations.

Do you want tax-free income in the UK?

You will have to meet certain criteria before you can take advantage of any of the Non-Domiciled arrangements. You will have to prove that the UK is not your permanent home. Other factors include proving that you are of non-British descent and also that it is not your intention to stay in the UK permanently.

These criteria can be complex and, for some of our European and global partners, difficult to understand. So why not ask the experts at St Matthew if these advantageous tax-regulations are worth considering? In an initial consultation we will discuss your personal details and requirements. After this we will be able to establish whether 'Non-Dom' status really is beneficial to you.

Is 'Non-Dom' status an option for me?

A common opinion among many people is that moving to a foreign country solely for fiscal reasons is a tactic only for the 'super rich'. This is not always the case.

Regardless of your personal wealth, a move to the UK can be worthwhile for you if you:

  • Earn a lot of money from investments
  • Own shares in a company
  • Own a company
  • Are anticipating a move to the UK
  • Do not want to live just in one place

Real advantages present themselves only if you have assets of a certain value. The effort is not worth it just to save a few thousand pounds in rent, for example.

Planning and preparation are everything

People who fulfill the Non-Dom status can profit from many of the tax benefits.

But you can also just make use of the Non-Dom classification if :

  • You spend more than 183 days of a tax-year in the United Kingdom, or
  • If you on average visit the UK for a minimum of 91 days every tax-year over a 4 year period.

A day is considered as an overnight stay, so day travel is not included.

What is the background for the Non-Dom legislation?

Unlike some European countries, the UK essentially relies on corporate tax instead of social security contributions. The UK has traditionally placed a high value on keeping its markets attractive for foreign investors.

Changes in the Non-Dom tax policy; Making further profit possible!

Right now, Non-Doms pay tax on foreign income in Great Britain, when that income is transferred to the UK. This is called the 'Remittance-Basis'.

But the UK goverment and its treasury are already planning changes being implemented in the next tax year, which could reduce the attractiveness of the Non-Dom classification.

  • The personal tax-free threshold, the tax advantages for married couples, and the annual tax advantage for speculative profits will be cut for anyone who claims the 'Remittance Basis' for themselves.
  • However, the minimum amount of roughly £1,000 will increase to £2,000. If the amount being transferred into the UK is less than this threshold, then it does not contribute to the personal tax-free threshold of the individual.
  • Persons under 18 years are not affected by this policy.

I am not a Non-Dom. What now?

People can freely decide every year whether they want to use the “Remittance Basis” or not. However, there is an additional tax for those who claim via the Non-Dom status.

The additional tax is scaled via the follow:

  • Non-Doms who have held the Non-Dom status for a minimum of seven of the last ten years, must pay a tax of £50,000 to occupy the remittance basis further for themselves. Income not transferred into the UK remains tax free.
  • Non-Doms who have held the Non-Dom status for a minimum of ten of the last twelve years, must pay £50.000.
  • Non-Doms who have held the Non-Dom status for a minimum of seventeen of the last twenty years, are considered as ”residents” and therefore fully liable to pay tax.

The good news is that there are no changes regarding the inheritance tax – IHT. If you have lived in the UK for less than seventeen years then you do not need to pay any inheritance tax on overseas assets.

As long as you declare and pay your British VAT, then there is no need to reveal your oversees incomes.

St. Matthews Accounting understands the specific changes in the Non-Dom legislation, and can provide advice and support for you.

We can relieve you of the significant paperwork, and represent you when communicating with the relevant UK authorities.

Request your non-dom consultation now

If you believe that you may benefit from the Non-Dom arrangements, or think that you could benefit from a move to the UK, then contact us for a consultation by phone. Click here to order now.

This analysis meeting is a structured consultancy, via telephone (or in person here in our offices). The meeting will require at least 1 hour. Our experienced advisers will look into your specific situation.

During the meeting we will consider the following facts:

  • Your work activities
  • Income Amount
  • Type of income
  • Assets
  • Your history
  • Your planning for the future
  • Your marital and family status
  • Age
  • Actual place of residence
  • Tax consequences of a move to London

Of course we will respond to your questions as quickly as possible, and are also happy to personalise this service wherever we can.

The result of the initial analysis meeting will be a specific recommendation regarding whether the Non-Dom Status is a possibility for you, and the real value of any tax advantages. Additionally, we will put together a tailored plan of action so Non-Dom status can be planned out realistically for you.

What the non-dom consultation will give you

For £250 we will discuss your situation with you, and inform you whether the Non-Dom status is possible for you or not, as well as any resulting advantages. This is a worthwhile investment if you consider that it may save you thousands of pounds in tax.

And always remember that our knowledge has been attained through our vast experience and not just via internet research!

During the consultancy, there will be a full disclosure of all facts. We will be frank and honest in our assessment of whether Non-Dom status is beneficial or even possible for you.

Process

Please fill out our initial non-dom consultation order form. Once payment is made we will  contact you and arrange an appointment. These appointments usually take place within one week after the order is placed.