The new FIG (Foreign Income and Gains) regime effective from April 2025 and its tax implications for international HNWI investors in UK property.
The UK's 200-year-old non-dom (non-domiciled) tax regime was fully replaced from April 2025. The new Foreign Income and Gains (FIG) regime exempts foreign income and capital gains from UK tax for the first 4 years of UK residency.
Key differences from the old system
- Remittance basis abolished
- 4-year "new arrival" exemption introduced
- Full worldwide income taxation from year 5 onwards
- IHT (Inheritance Tax) linked to a 10-year residence test
Practical implications for international investors
Scenario A — Newly UK-resident investor: For the first 4 years, your foreign rental and deposit income outside the UK remains outside UK tax.
Scenario B — Long-term UK resident: UK property income is taxed in the UK, but offshore structuring (Jersey, BVI LLP) remains on the table for estate planning.
SDLT surcharges still apply
The non-UK-resident SDLT surcharge of +2% remains. Corporate buyers may face an additional +15% (enveloped dwellings) charge.
How is it structured?
Every client engagement combines a solicitor and a chartered tax adviser in a bespoke structuring exercise.
For a confidential discussion of your position, get in touch.
Frequently Asked Questions
What is non-dom status?
"Non-domiciled" (non-dom) status applies to UK residents whose legal domicile — their permanent home country — is outside the UK. It previously allowed them to shelter foreign income and assets from UK taxation under certain conditions.
What changed with the 2025–2026 non-dom reforms?
The UK government abolished the remittance basis system from April 2025, replacing it with a four-year Foreign Income and Gains (FIG) regime. Individuals who have been non-UK resident for the preceding ten years can now live in the UK for up to four years without paying UK tax on foreign income and gains.
How do these changes affect Turkish investors?
Turkish nationals living in Turkey and buying UK property are not directly affected, as they are not UK residents. However, those considering relocating to the UK — or who already reside there — must review their tax planning carefully, as the old protections no longer apply in the same way.
What should someone losing non-dom status do?
Seek specialist tax advice immediately. Existing asset structures — including trusts and company holdings — should be reviewed, and the transition reliefs available during the changeover period should be assessed with a qualified adviser.