The budget today announced a rule that limits the non-dom regime for those living in the UK to those who have lived in the UK for no more than 15 years out of 20. This change is due to be implemented from April 2017. There are quite a few other changes but this non-dom change is probably the most immediately significant one for me and some of the clients I deal with.
So we now face a further period of change to the UK non-dom regime.
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 we will soon reach the point for greater numbers of non-doms where residence other than in the UK is more attractive.
Excluding the settlor is also an alternative that many will now have to consider where ceasing residence is not an option.
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 for more people.
The Isle of Man as well as Ireland, if business needs to move from the UK, 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 the time to start thinking about what to do when these changes happen. Even if the changes do not take place or do not affect for whatever reason it is a good idea to revisit existing arrangements to make sure that everything is still being run in an optimal and cost effective fashion.
No time like the present as my mother used to say.
Incidentally, I am expecting trustees to have to submit a self assessment tax return to the UK in the near future. At present, this is a non-statutory requirement but the indications in the budget are that this will soon become a legal requirement.