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Rachel Reeves to Revise Non-Dom Tax Rules Amid Wealthy Exodus


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The UK government is set to revise its controversial changes to tax rules for non-domiciled residents following a record exodus of millionaires from the country. Chancellor Rachel Reeves announced the amendments during a fringe event at the World Economic Forum in Davos, acknowledging concerns raised by the non-dom community.  

 

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“We have been listening to the concerns that have been raised by the non-dom community,” Reeves told Emma Tucker, editor of *The Wall Street Journal*. She revealed that an amendment to the Finance Bill would soon be tabled, increasing the generosity of the temporary repatriation facility. This facility allows non-doms to transfer money into the UK without incurring significant taxes, and the revised rules will expand the criteria for eligibility.  

 

Reeves also sought to address fears regarding double-taxation agreements, assuring non-doms that the changes would not affect such arrangements. “There’s been some concerns from countries that have double taxation conventions with the UK, including India, that they would be drawn into paying inheritance tax,” she said. “That’s not the case: we are not going to change those double-taxation conventions.”  

 

The urgency of these changes is underscored by alarming migration data. Last year, Britain experienced a net loss of 10,800 millionaires, a staggering 157% increase compared to 2023, according to data from New World Wealth and Henley & Partners. This outflow of wealthy residents was second only to China and included 78 centi-millionaires and 12 billionaires. The majority relocated to European countries such as Italy and Switzerland, as well as the United Arab Emirates.  

 

The exodus is expected to continue, with tax advisers reporting a growing number of British entrepreneurs considering leaving the UK due to the tax hikes announced in the autumn budget. The Office for Budget Responsibility (OBR) previously forecasted that Labour’s changes to the non-dom regime would generate over £33 billion for the exchequer during this parliament. A significant portion of this estimate relied on non-doms paying £10.6 billion in taxes at reduced rates through the temporary repatriation facility.  

 

However, the OBR has admitted to a “very high” degree of uncertainty in its predictions. Achieving these figures depends not only on non-doms remaining in the UK but also on their willingness to bring assets worth tens of billions of pounds into the country to take advantage of the facility’s newly lowered 12% tax rate.  

 

The record outflow of wealth has cast doubt on whether those considering relocating to London will follow through. Many believe that the recent tax changes, coupled with increasing financial pressures, have significantly diminished the UK’s appeal to high-net-worth individuals.  

 

As Reeves moves to adjust the rules in response to mounting concerns, it remains uncertain whether the revised measures will be enough to stem the tide of departures or restore confidence among the UK’s wealthiest residents.

 

Based on a report by The Times 2025-01-25

 

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  • Haha 1
Posted

What did she think was going to happen?

 

They would all stay and happily hand their cash over to Rachel from accounts? 

 

Staggering incompetence. 

 

 

  • Like 1
  • Agree 1
Posted
16 minutes ago, The Cyclist said:

 

The damage is done. Why would they even think about coming back.

 

 

 

Money is as shy as a deer grazing at the forest's edge, one loud noise and it's gone.

  • Agree 1

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