The UK abolished the non-dom regime on 6 April 2025. Foreign income and gains are now taxed on the basis of residence, not domicile, and inheritance tax follows long-term residence. Ever since, a loud debate has run over a possible "wealth exodus": how many rich people are leaving, and whether the reform will raise the money the Treasury expects.
The short answer, as of October 2026, is that nobody has a full count yet. The latest official HMRC figures cover the last year before the reform. Forecasts from private firms point to large outflows, while the government's own payroll checks have pointed to departures roughly in line with what the fiscal watchdog assumed.
This article sets out what changed, what each data source actually measures, and why the numbers differ so much.
Key takeaways
- The remittance basis ended on 6 April 2025. New arrivals get a four-year foreign income and gains (FIG) exemption, and only after 10 years of non-residence.
- Inheritance tax now depends on being resident for 10 of the previous 20 tax years, with a "tail" of 3 to 10 years after you leave.
- HMRC's July 2026 statistics show 73,400 non-doms in 2024-25, down only about 0.5%, but that year ended before the new rules began.
- Commercial forecasts, such as Henley & Partners' projection of a net outflow of 16,500 UK millionaires in 2025, are estimates, not official counts.
- The first official data on the post-reform year is not expected until 2027.
What changed on 6 April 2025
For generations, people who lived in the UK but were domiciled elsewhere could choose the remittance basis. They paid UK tax on foreign income and gains only when they brought the money into the UK. Long-term residents eventually became "deemed domiciled", but the system still gave many wealthy foreigners a long period of light taxation on offshore wealth.
The Finance Act 2025 replaced this with a residence-based system. The table below shows the main differences.
| Area | Before April 2025 | From 6 April 2025 |
|---|---|---|
| Foreign income and gains | Remittance basis available to non-doms (with an annual charge for long-stayers) | Taxed as they arise, except under the 4-year FIG regime |
| Who qualifies for relief | Anyone non-UK domiciled | Only new residents after 10 consecutive tax years of non-residence |
| Inheritance tax scope | Based on domicile and deemed domicile (15 of 20 years) | Based on long-term residence (10 of the previous 20 tax years) |
| After leaving the UK | Deemed domicile fell away after a few years abroad | IHT "tail" of 3 to 10 years, depending on time spent in the UK |
| Offshore trusts | Protections for many settlor-interested trusts | Most protections removed for UK residents outside the FIG regime |
Several transitional measures soften the change. A Temporary Repatriation Facility lets former remittance-basis users bring pre-April 2025 foreign income and gains to the UK at a flat 12% for 2025-26 and 2026-27, rising to 15% for 2027-28. Some former non-doms can also rebase foreign assets held on 5 April 2017 to their value on that date. HMRC's FIG regime helpsheet HS266 sets out the qualifying rules.
The inheritance tax change is the one advisers mention most often. Under HMRC's guidance on inheritance tax for long-term UK residents, someone who was resident for 10 to 13 years stays within UK inheritance tax for 3 tax years after leaving. Each extra year of residence adds a year, up to a maximum of 10. For a family with worldwide assets, that tail can matter more than any income tax change.
The wider tax backdrop
The non-dom reform did not happen alone. Since October 2024, the government has also:
- raised capital gains tax rates to 18% and 24%;
- capped 100% agricultural and business property relief for inheritance tax, first at £1 million and then, after a December 2025 announcement, at £2.5 million from April 2026;
- confirmed that unused pension funds are due to come into the inheritance tax net from April 2027;
- announced in the November 2025 Budget higher tax rates on dividends from April 2026 and on savings and property income from April 2027;
- announced a High Value Council Tax Surcharge on English homes worth £2 million or more from April 2028.
Taken together, these changes affect UK-domiciled business owners and wealthy families as well as former non-doms. That matters, because many of the "millionaire migration" figures in the press do not separate the two groups.
How big is the exodus? What each source measures
HMRC statistics: official, but early
HMRC published its latest statistics on non-domiciled taxpayers on 30 July 2026. They cover the tax year ending 5 April 2025, the last year of the old regime.
| Measure (2024-25, provisional) | Figure |
|---|---|
| Non-domiciled taxpayers | 73,400 (down about 400, or 0.5%) |
| Deemed domiciled taxpayers | 8,500 (down about 800) |
| Combined population | 81,900 (down from 83,100) |
| Combined income tax, CGT and NICs | £13.6 billion (up 9%) |
| Newly arrived non-doms | about 8,600 (down from 10,000) |
| Non-doms leaving the population | about 9,000 (down from 11,200) |
These figures show a small decline in the final year, with fewer arrivals. They say nothing direct about who left after April 2025. HMRC has said this is the final release in its current form, with a last update in 2027 once more data is complete.
The OBR's assumptions
The Office for Budget Responsibility built departures into its costing of the reform. In its October 2024 costing, detailed in a January 2025 supplementary release, it assumed that 25% of non-doms with trusts who cannot use the new regime would leave, and 12% of those without trusts. The OBR rated the costing as very highly uncertain. In 2025 the Financial Times reported that HMRC payroll data broadly matched those projections. Critics answer that payroll data misses many of the wealthiest non-doms, who are not employees.
Private forecasts
Henley & Partners, an investment migration firm, projected in its 2025 report that the UK would see a net outflow of 16,500 millionaires that year, the largest of any country. Its estimates rely on data from New World Wealth and count people with liquid wealth of at least $1 million, whatever their tax status. Groups such as the Tax Justice Network have questioned the method.
Henley's 2026 report adds a different signal. It says that in the first five months of 2026, non-UK nationals made up 53% of its applications from people living in the UK, up from 44% in 2025. That is a measure of interest from its own client base, not a count of departures.
Other firms and lobby groups have published their own estimates, some much higher than the OBR's assumptions. Most come from organizations with a view on the policy, which is worth keeping in mind.
Why the numbers disagree
Three issues explain most of the gap between headlines:
- Different populations. HMRC counts people who claimed non-dom status. Henley counts dollar millionaires of any status. A departing UK-born entrepreneur appears in one and not the other.
- Different time frames. The official data stops at April 2025. Forecasts look ahead. Anecdotes from advisers and estate agents cover individual cases, not totals.
- Normal churn. Even before the reform, about 9,000 to 11,000 people left the non-dom population every year, while a similar number arrived. A headline about departures means little without the arrivals.
The fiscal question is narrower than the migration question. A small number of very wealthy leavers can move tax receipts more than thousands of moderately wealthy ones, so even an accurate head count would not settle the debate.
Where departing residents tend to go
Advisers and press reports point to a familiar set of destinations. The choice usually depends on the type of wealth, family needs and how long the person plans to stay.
- The UAE, especially Dubai, for no personal income tax. Our guide on whether tax-free Dubai is the only option for British expats looks at the trade-offs.
- Italy, through its flat annual tax on foreign income for new residents. See Italy's flat tax for new residents.
- Switzerland and Monaco, long-standing bases for very wealthy families, with lump-sum taxation available in many Swiss cantons.
- Portugal, Cyprus, Greece and Malta, which run special regimes for new residents. Our overview of non-dom and special tax regimes in Europe compares them.
For a wider list, see low-tax countries for UK citizens. Each regime has its own entry conditions and costs.
What leaving involves in practice
Moving abroad does not end UK tax ties on its own. Your residence status for each tax year depends on the UK statutory residence test, which looks at days spent in the UK and your remaining ties. Split-year treatment may apply in the year you leave.
Two other rules catch people out. The temporary non-residence rules can tax certain gains and income on your return if you come back within five years. The inheritance tax tail described above can keep worldwide assets in scope for up to 10 years. The UK has no general exit tax, but these rules work in a similar way for some people; our article on whether the UK has an exit tax explains how.
What to watch next
The next milestones are HMRC's 2027 update and, later, the first statistics and self-assessment receipts for 2025-26, the first year of the new regime. Further Budget changes to inheritance tax or capital gains tax could shift behavior again.
Frequently asked questions
Has the UK fully abolished non-dom status?
Yes, for income tax and capital gains tax purposes. Since 6 April 2025, domicile no longer decides how foreign income and gains are taxed. Domicile still matters in a few transitional cases and in some older inheritance tax rules.
How many non-doms have left the UK?
There is no official figure for the period after April 2025 yet. HMRC's latest data shows about 9,000 people left the non-dom population in 2024-25, before the reform. Figures for the first post-reform year are not expected before 2027.
What is the FIG regime?
It is a four-year exemption from UK tax on foreign income and gains for people who become UK resident after at least 10 consecutive tax years of non-residence. Claimants lose some personal allowances and must report the income they exempt.
Does leaving the UK end my inheritance tax exposure?
Not right away for long-term residents. If you were UK resident for at least 10 of the previous 20 tax years, you generally remain in scope for 3 to 10 tax years after leaving, depending on how long you lived in the UK.
Important: This article is general information, not tax, legal or financial advice. Rules change often and depend on your personal circumstances. Speak with a qualified professional in each relevant country before you act.