UK Non-Dom Abolition 2025 Impact -- FIG Regime, TRF and Who’s Affected

Last reviewed: 26 April 2026

The non-dom abolition 2025 impact is the most significant change to UK international tax rules since the introduction of the Statutory Residence Test in 2013. Finance Act 2025 (Schedule 9), effective from 6 April 2025, abolished the UK non-domicile remittance basis -- the mechanism that allowed non-UK-domiciled individuals resident in the UK to shelter unremitted foreign income and gains from UK tax -- and replaced it with the 4-year FIG (Foreign Income and Gains) regime for qualifying new arrivals. Approximately 74,000 individuals had previously claimed the non-dom remittance basis per HMRC estimates. For the full UK tax residency framework, see our UK tax residency guide. For the investment account implications of these changes, see our UK expat investments guide.

The non-dom abolition 2025 impact framework has three main elements: (1) the abolition of the remittance basis for all income and gains arising from 6 April 2025 -- UK residents are taxed on worldwide income from day one unless they qualify for the 4-year FIG; (2) the Temporary Repatriation Facility (TRF) for pre-2025 unremitted foreign income and gains, allowing designated amounts to be brought to the UK at flat reduced rates; and (3) the replacement of domicile-based IHT with residence-based IHT from 6 April 2025. The OBR (Office for Budget Responsibility) estimated at Spring Budget 2024 that the non-dom abolition would generate approximately £2.7bn per year in additional tax revenues; the Autumn Budget 2025 OOTLAR (gov.uk/government/publications/autumn-budget-2025-overview-of-tax-legislation-and-rates-ootlar) confirmed the measures. The authoritative HMRC guidance is at gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals and HMRC’s RDR1 (gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis).

Pre-2025 non-dom regime: what was abolished

The pre-6 April 2025 non-dom remittance basis allowed non-UK-domiciled individuals (those born outside the UK or with a "permanent home" elsewhere in the sense of domicile) who were UK-resident to elect to be taxed on the remittance basis: UK-source income was taxable in the UK from day one; foreign income and gains were taxable in the UK only when "remitted" (brought into the UK or used to benefit the individual or family in the UK). The mechanism imposed annual Remittance Basis Charges (RBC) for long-term UK residents: £30,000 per year for those UK-resident for 7 of the prior 9 years; £60,000 per year for 12 of the prior 14 years; £90,000 per year for 17 of the prior 20 years (the "17-year rule" introduced in 2017). The non-dom regime was one of the oldest UK tax privileges, dating from the 19th century in some form; it was used by internationally mobile high-net-worth individuals with offshore income to reduce UK tax liability on unremitted foreign earnings. The Spring Budget 2024 announcement by the then-Chancellor stated abolition from 6 April 2025; Finance Act 2025 Schedule 9 implemented the abolition. The HMRC RDR3 technical guidance on the remittance basis is archived; HMRC’s updated RDR1 (gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis) is now the technical reference for the new framework.

4-year FIG regime: the replacement for new arrivals

The 4-year FIG (Foreign Income and Gains) regime is the statutory replacement for the non-dom remittance basis, effective from 6 April 2025 (Finance Act 2025 Schedule 9; gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals). Eligibility: qualifying new UK residents who have not been UK-resident in any of the 10 consecutive tax years prior to becoming UK-resident from 6 April 2025 are entitled to the 4-year FIG regime. Under the FIG regime: all foreign income and gains -- overseas dividends, overseas rental income, foreign employment income, foreign capital gains -- are fully exempt from UK income tax and CGT for the first 4 tax years of UK residency, regardless of whether the income is remitted to the UK. There is no remittance test; no annual charge; no mixed fund tracking requirement. The FIG regime is declared on the SA109 (Residence, Remittance Basis etc.) supplementary pages; foreign income need not be reported as UK-taxable during the FIG period. From tax year 5 onwards, worldwide income is fully UK-taxable for the individual. UK dividend rates from 6 April 2026 (Autumn Budget 2025 OOTLAR) apply to UK-source dividends received by FIG-period individuals: 10.75% ordinary rate (was 8.75%), 35.75% upper rate (was 33.75%), 39.35% additional rate (unchanged). UK-source income (UK rental, UK dividends, UK employment) is taxable from day one even during the FIG period. The FIG regime applies only to income and gains arising from 6 April 2025; pre-2025 income falls under the TRF.

Temporary Repatriation Facility (TRF): rates and window

The TRF addresses the large pools of pre-2025 foreign income and gains that were held offshore by former non-doms under the remittance basis. The TRF (gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals) allows UK-resident individuals to "designate" their pre-6 April 2025 unremitted foreign income and gains and bring them to the UK at a flat reduced rate: 12% in 2025/26 and 2026/27; 15% in 2027/28. After 5 April 2028, the TRF window closes and pre-2025 unremitted income becomes potentially taxable at full income tax or CGT rates on remittance for those who have re-established UK residency. The TRF is available to individuals who were previously non-dom UK residents using the remittance basis and who have pre-2025 unremitted foreign income or gains (including offshore investment returns, foreign property gains, and overseas business profits). TRF designations are made via the SA109 for the relevant tax year (2025/26 online deadline: 31 January 2027; 2026/27 deadline: 31 January 2028). Specialist CIOT-qualified UK cross-border tax advice is essential before making TRF designations, as the designation is generally irrevocable once made. The Autumn Budget 2025 OOTLAR confirmed the TRF rates and window; the OBR estimated significant revenue from TRF uptake during 2025/26 and 2026/27.

Residence-based IHT: replacing domicile-based rules

Finance Act 2025 (effective 6 April 2025) abolished the old domicile-based UK IHT framework and replaced it with residence-based IHT. Under the old framework: UK-domiciled individuals were subject to UK IHT on their worldwide estate; non-UK-domiciled individuals were subject to UK IHT only on UK-sited assets. The new residence-based IHT framework: individuals who have been UK-resident in at least 10 of the prior 20 tax years are "long-term UK residents" (LTRs) subject to UK IHT on their worldwide estate -- including overseas property, overseas bank accounts, and overseas investments. This applies symmetrically: a UK-domiciled individual who has never been UK-resident for 10 of the prior 20 years is no longer within the worldwide IHT charge; a non-UK-domiciled individual who has been UK-resident for 10+ of the prior 20 years is now within the worldwide IHT charge. LTR tail period: after departing the UK, LTRs remain within the worldwide IHT framework for a tail period of up to 10 years (proportional to the number of years of UK residency -- the exact tail period calculation is set out in HMRC’s IHT guidance at gov.uk/inheritance-tax). The nil-rate band remains £325,000 (frozen to April 2030); IHT rate is 40% above this on the worldwide estate during the tail. Residence-based IHT eliminates the old concept of "deemed domicile" which applied after 15 of the prior 20 years for IHT purposes.

Who is affected: three categories

The non-dom abolition 2025 impact falls across three broad categories. Category 1 -- Existing UK-resident non-doms on 5 April 2025: These individuals faced the most abrupt change. From 6 April 2025, their worldwide income (from foreign investments, foreign employment, foreign rentals) became fully UK-taxable unless they qualify for the FIG regime (which requires 10 prior years of non-UK-residency -- most long-term UK non-doms do not qualify). Their pre-2025 unremitted offshore income can be addressed via the TRF at 12%-15%. Their worldwide assets are potentially within the new IHT framework. HMRC estimated approximately 74,000 individuals were using the remittance basis before abolition (HMRC non-dom statistics, gov.uk). Category 2 -- New UK arrivals from 6 April 2025: These individuals benefit the most from the transition. Those with 10+ years of prior non-UK-residency qualify for the 4-year FIG regime -- 4 years of full foreign income exemption without remittance test. This is a more generous and simpler benefit than the old remittance basis for those within the first few years of UK residency. Category 3 -- Non-UK-residents who left the UK before 6 April 2025: Their overseas income during non-UK-residency is unaffected by the abolition. If they return to the UK, the FIG regime applies if they have been non-resident for the required 10 prior years. The OBR Spring Budget 2024 impact note estimated £2.7bn annually from the non-dom abolition.

Common transition scenarios

Three typical transition scenarios for the non-dom abolition 2025 impact: Scenario A -- Indian national, 20 years UK-resident, used remittance basis: Post-6 April 2025, worldwide income from Indian rental properties, Indian stock dividends, and Indian bank interest is fully UK-taxable at UK income tax rates (up to 45%). UK dividend rates from 6 April 2026 apply to any UK-source dividend income: 10.75%/35.75%/39.35% (Autumn Budget 2025 OOTLAR). TRF option: 12% on pre-2025 Indian income designated in 2025/26 or 2026/27, versus 45% additional rate otherwise. Potential worldwide IHT exposure on Indian property and investments if LTR threshold is met. Scenario B -- US national, 3 years UK-resident: Qualifies for FIG regime (only 3 years UK-residency, not 10). US rental income, US dividends, US capital gains are all outside UK tax for the remaining 1 year of FIG period; worldwide income from year 5 is UK-taxable. No TRF obligation (no pre-2025 unremitted UK income). IHT: only 3 years UK-residency, far short of LTR threshold. Scenario C -- UAE national, first year UK-resident (from September 2025): Qualifies for full 4-year FIG regime (never previously UK-resident). UAE property rental, UAE investment income, UAE business profits all outside UK tax for 4 years without any remittance requirement. From year 5 (2029/30), worldwide income becomes UK-taxable. IHT tail not relevant for 10+ years.

SA109 and reporting changes

The SA109 supplementary form (Residence, Remittance Basis etc., gov.uk/government/publications/self-assessment-residence-remittance-basis-etc-sa109) has been updated for 2025/26 to reflect the Finance Act 2025 non-dom abolition. Key changes: the remittance basis election boxes have been removed for income arising from 6 April 2025; new boxes are available for the FIG regime declaration and for TRF designation amounts. Former non-doms who were UK-resident on 5 April 2025 and who have switched to worldwide taxation must declare all foreign income (previously sheltered) on SA106 (Foreign income supplementary pages) for the first time from 2025/26. The SA109 TRF designation is made in the tax year in which the designated income is remitted; the 12% or 15% flat rate is applied via Self Assessment. The 2025/26 online Self Assessment deadline is 31 January 2027; the 2026/27 deadline is 31 January 2028 -- both are TRF window years. Specialist tax advice from a CIOT-qualified adviser is essential for former non-doms completing their first post-abolition SA return in 2025/26; the complexity of clean capital tracking and mixed fund rules for pre-2025 income pools requires expert navigation. HMRC’s non-dom changes publication at gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals is the primary reference.

This article is for general information only and does not constitute tax, legal, financial or immigration advice. Rules and rates change; verify with the primary sources cited or consult a qualified adviser before acting.

FAQ

What did the non-dom abolition 2025 actually change?

Finance Act 2025 (Schedule 9, from 6 April 2025) abolished the UK non-dom remittance basis -- the mechanism allowing non-UK-domiciled UK residents to pay UK tax only on foreign income remitted to the UK. From 6 April 2025, all UK residents are taxed on worldwide income unless they qualify for the 4-year FIG regime. Pre-2025 unremitted income can be addressed via the TRF (12%-15%). Domicile-based IHT was replaced by residence-based IHT (10-year long-term resident rule). The OBR estimated £2.7bn in additional annual revenue from the change.

Who qualifies for the 4-year FIG regime?

Qualifying new UK residents who have not been UK-resident in any of the 10 consecutive tax years before their year of UK arrival from 6 April 2025 qualify for the FIG regime. Under FIG, all foreign income and gains are exempt from UK tax for 4 years without a remittance test. UK-source income remains taxable from day one. From year 5, worldwide income is fully UK-taxable. Long-term UK non-doms who were already UK-resident on 6 April 2025 generally do not qualify (they were UK-resident within the prior 10 years). HMRC RDR1 (gov.uk/hmrc-internal-manuals/residence-domicile-and-remittance-basis) is the technical reference.

What are the TRF rates and when do they close?

The Temporary Repatriation Facility (TRF) allows pre-2025 unremitted foreign income and gains to be brought to the UK at: 12% in 2025/26 (January 2027 SA deadline); 12% in 2026/27 (January 2028 SA deadline); 15% in 2027/28 (January 2029 SA deadline). The TRF window closes 5 April 2028; after this date, pre-2025 unremitted income potentially becomes taxable at full rates on remittance. TRF designations are made via the SA109 for the relevant tax year. CIOT-qualified specialist advice is essential before making TRF designations as they are generally irrevocable.

How has UK IHT changed for former non-doms?

Finance Act 2025 replaced domicile-based IHT with residence-based IHT from 6 April 2025. Individuals UK-resident in at least 10 of the prior 20 tax years are long-term UK residents (LTRs) subject to UK IHT on their worldwide estate -- including overseas property, bank accounts, and investments. The LTR tail period extends up to 10 years after departure. The old non-dom IHT exemption on non-UK assets is abolished for LTRs from 6 April 2025. The nil-rate band remains £325,000 (frozen to April 2030). HMRC’s IHT guidance at gov.uk/inheritance-tax covers the new rules.

What are the new UK dividend rates from April 2026?

UK dividend tax rates from 6 April 2026 (Autumn Budget 2025 OOTLAR): ordinary rate 10.75% (was 8.75%); upper rate 35.75% (was 33.75%); additional rate 39.35% (unchanged). These apply to UK-resident taxpayers on dividends above the £500 dividend allowance for 2025/26. For former non-doms who were sheltering UK dividend income under the remittance basis: from 6 April 2025 (if UK-resident), UK dividends are fully taxable at these rates unless the individual qualifies for the FIG regime. Non-resident UK shareholders pay UK dividend withholding tax at the applicable DTC rate instead.

What happened to the deemed domicile concept after the abolition?

The "deemed domicile" concept for income tax, CGT, and IHT purposes has been abolished. Previously, an individual became "deemed domiciled" in the UK for IHT purposes after 15 of the prior 20 tax years of UK residency, losing non-dom IHT protection. Under the new framework, domicile is no longer relevant for UK income tax, CGT, or IHT. The new IHT threshold is 10 of the prior 20 tax years (LTR status). For income tax, the FIG regime (4 years for new arrivals with 10 prior years of non-residency) replaces all domicile-based exemptions. Finance Act 2025 Schedule 9 is the implementing legislation; gov.uk/government/publications/changes-to-the-taxation-of-non-uk-domiciled-individuals is the primary reference.

Sources

1. GOV.UK -- Changes to the taxation of non-UK domiciled individuals (FIG regime, TRF 12%/15%, Finance Act 2025) (verified 26 April 2026)
2. HMRC -- RDR1: Residence, Domicile and Remittance Basis (FIG regime and post-2025 IHT framework) (verified 26 April 2026)
3. GOV.UK -- UK IHT: residence-based IHT from 6 April 2025 (LTR 10-year rule and tail period) (verified 26 April 2026)
4. GOV.UK -- Autumn Budget 2025 OOTLAR (TRF confirmation; dividend rates 10.75%/35.75%/39.35% from 6 April 2026) (verified 26 April 2026)
5. HMRC -- SA109 Residence Remittance Basis form (updated for FIG declaration and TRF designation) (verified 26 April 2026)