With effect from 6 April 2017, where an individual has been a UK tax resident in 15 out of the previous 20 tax years, they are now deemed to be domiciled in the UK for inheritance tax, income tax and capital gains tax purposes. Along with the new rules, there are special rules for those born in the UK, who became non-UK domiciled for a period, and who are now returning to the UK.

The new rules may have a significant impact on the UK tax position of some taxpayers who would previously have made use of the remittance basis of taxation. With the new rules comes opportunities too. 

Deemed domiciled on 6 April 2019

If you will become deemed domiciled on 6 April 2019 you should review your own tax position as there may be tax planning opportunities prior to 6 April 2019.

Remittance basis

For individuals who have claimed the remittance basis and paid the remittance basis charge, there is a one-time opportunity to cleanse “mixed funds”. This would allow, for example, clean capital to be remitted to the UK in the future in priority to unremitted income or gains. The window for carrying out this exercise expires on 5 April 2019. 

Top tip: The clock is ticking - this can be a complex exercise and we recommend getting in touch with one of our advisers as soon as possible.

Read the next section of our tax planning guide: pension planning or return to the main page.

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