The recent Budget included some good news for non-domiciliaries. Specifically it has been confirmed that:
- The overseas assets of individuals who become deemed domiciled under the new rules in April 2017 will be rebased for capital gains tax (CGT) purposes so that pre-6 April 2017 gains will not be taxable. However, is it unclear whether rebasing will be extended to those who become deemed domiciled in subsequent years.
- Those who expect to become deemed domiciled under the new 15/20 year rule will benefit from transitional provisions in relation to offshore funds to provide certainty on taxable remittances to the UK.
These are welcome concessions; however, much is still to be confirmed in relation to the government's non-dom proposals. In addition, the new rules are to be deferred until Finance Bill 2017 so there will only be a narrow window to take action before the new regime is introduced on 6 April 2017. Therefore now is a good time to reflect on what we know so far and to consider what steps can be taken in the meantime. This is especially the case for those who will fall within the 'returning non-doms' rule who may be particularly adversely affected by the new regime.
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This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.
© Farrer & Co LLP, April 2016