Abolished from 6 April 2025
Domicile no longer determines how you are taxed in the UK. From 6 April 2025 the remittance basis was abolished and replaced with a system based on residence.
Under the old rules, a non domiciled individual could keep foreign income and gains outside UK tax indefinitely, provided they did not bring the money to the UK, paying an annual charge for the privilege. That concept, and the charge, are gone.
What replaced it: the 4 year FIG regime
New arrivals get the foreign income and gains regime for their first 4 years of UK residence, provided they were non resident for the previous 10 years.
During those 4 years, qualifying foreign income and gains are not taxed in the UK at all, and, unlike the old remittance basis, you can bring the money into the UK freely. That is genuinely more generous than the old rules for those who qualify. The old system taxed you the moment you remitted; this one does not.
The catch is the cliff. After 4 years you are taxed on your worldwide income and gains like anyone else. There is no tapering and no extension. It is a short, sharp window.
Note also that if you claim the FIG regime for a year, you lose your personal allowance and your capital gains annual exempt amount for that year. For someone with modest foreign income, claiming can leave you worse off, so it needs working out rather than assuming.
Who this actually affects
People arriving in the UK for the first time, or returning after a decade or more away, should look at the 4 year window and plan around it. What you do in year 4 matters a great deal more than what you do in year 1.
Long term UK residents who were previously claiming the remittance basis have lost it. If that is you, and you have not restructured, you are being taxed on worldwide income now.
Inheritance tax also moved to a residence basis, which is a significant change for anyone with foreign assets and long UK residence, and it is a separate piece of planning.
Common questions
I have been here 6 years. Can I use the FIG regime?
No. It is only available in the first 4 years of residence, and only if you were non resident for the 10 years before arriving.
Is domicile irrelevant now?
For income tax and capital gains, essentially yes. Domicile remains relevant in other areas of law, including succession, so it has not disappeared entirely.
This is a complex area and the transitional rules for those who previously claimed the remittance basis are involved. This reflects the position as at July 2026. If you are affected, this is worth proper advice rather than a web page. Get in touch.