Proposals affecting UK tax for non-residents during the Autumn Budget 2024 include a reform of the non-UK domiciled rules, tackling offshore tax avoidance and changes to rules on overseas pensions.  

Budget 24 overseas and non resident

The Chancellor, Rachel Reeves announced the following measures:

  • The non-UK domiciled regime will be abolished from 6 April 2025. 
  • A new temporary repatriation facility will be available for certain qualifying individuals. 
  • The government aims to tackle offshore tax avoidance and non-compliance.
  • There are updates to overseas pension transfers. 
  • There will be a repeal of offshore receipts in repect of intangible property (ORIP). 

Non-UK domiciled regime

The current non-UK domiciled regime which allows for income to be taxed on a remittance basis for non-UK domiciled taxpayers will be abolished and replaced with a new regime based on residence status.

From 6 April 2025:

  • 100% tax relief will be available for new arrivals to the UK on their foreign income and gains.
  • The relief will be available for the first 4 years of their UK residence provided they have not held residence within the UK in any of the 10 consecutive years prior to their arrival in the UK.
  • For past remittance basis users, foreign assets will be rebased at 5 April 2017 for capital gains tax (CGT) purposes.
  • Foreign income and gains arising prior to 5 April 2025 will continue to be taxed under the remittance basis rules even if the individual is eligible for the new 4-year regime.
  • The current domiciled based inheritance tax (IHT) system will be replaced with a residence based system. 

A temporary repatriation facility will be available for individuals who have previously claimed using the remittance basis.

This facility will: 

  • Only be available for a transitional period for 3 years.
  • Allow individuals to be able remit income and gains arising before 5 April 2025 at a reduced rate.
  • Be available at 12% for the first two years and 15% for the last year.

Overseas workday relief will be: 

  • Retained but extended from 3 years to 4 years in line with the new measures. 
  • Limited to the lower of £300,000 or 30% of the individuals total employment income. 

Tackling off-shore anti-avoidance

  • The government have requested evidence from taxpayers and their advisors which will allow them to simplify the current personal tax off-shore anti-avoidance rules. 
  • The review will include the transfer of assets abroad, capital gains tax (CGT) and the settlement legislation to seek a better understanding of the current anti-avoidance rules. 

Tackling off-shore non-compliance

  • HMRC will tackle offshore non-compliance by delivering transparency through international cooperation. The aim is to assist taxpayers in getting tax right the first time and minimising errors.

Changes to rules for overseas pensions

  • The overseas transfer charge is a 25% charge that applies to individuals who transfer all or part of their pension to a qualifying recognised overseas pension scheme (QROPS). There is an exclusion from the charge when certain conditions are met.  
  • The exclusion from the charge has been removed from 30 October 2024. 
  • Additionally, there will be a requirement for all registered pension schemes to have a UK resident scheme administrator from 6 April 2025.  

Repeal of offshore receipts in respect of intangible property (ORIP)

  • ORIP was originally a short term measures aimed at removing the incentive for large multinational enterpriese (MNE)s holding intangible property in low tax jurisdicition where the property is used to generate UK income. 
  • ORIP will be repealed in respect of income arising from 31 December 2024. 

  

Back to Autumn Budget 2024

Useful guides on this topic

Autumn Budget 2024: At a glance
Our At a glance view to the Autumn Budget 2024

Our Autumn Budget 2024: Live Speech highlights
Our live feed summary of the highlights of the Chancellor's Autumn Budget speech.

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