The Remittance Basis

The UK tax system provides a unique opportunity for individuals who are resident foreign domiciliaries to reduce their exposure to UK tax. Whilst the expectation is that the current regime will end, possibly as early as 6 April 2025, there remain opportunities for UK resident non-doms to utilise these rules in the meantime.

Understanding the complexities of the remittance basis

It is likely that the rules will remain of relevance going forward in relation to foreign income and gains arising prior to any reforms coming into effect.

By segregating your wealth between that in the UK and that kept overseas, any income and capital gains on your overseas wealth will only be subject to UK tax to the extent that it is remitted to the UK. This position can be extended through the use of offshore trusts where circumstances allow.

The remittance basis also includes relaxations to encourage investment into the UK. Remittances of funds to invest into UK limited liability companies are exempt from UK tax provided those funds are promptly removed from the UK when the investment is sold.

The remittance basis comes with its complexities and remittances can be made inadvertently, either directly or indirectly. However, with the proper structuring of your financial affairs and the help Ritchie Phillips can provide you, it should be possible for you to take advantage of this unique opportunity. Please get in touch if you would like to discuss the above.