Non-Dom Reform 2025: Impact on UK Tax and Residency Status

Leaving the UK But Still Tax Resident?

Following the recent abolishment of the non-dom regime for non-UK persons many individuals have taken steps to leave the UK, in some cases moving with their family overseas but remaining UK resident at the same time – perhaps because they still work here.

Where it is the case that an individual is dual resident (i.e.in the UK and another) it would then be a matter of considering the application of the dual residency rules.  To explain further, if you are resident in both countries, you will need to review the UK’s Double Tax Treaty with that particular country.

The purpose of a treaty is to dictate which country has a taxing right over certain income; the treaty divides the taxing rights over an individual’s income and gains between the two countries.  Largely, this is a question of establishing the individual’s “treaty residence” position, as it is the country of treaty residence which generally assumes the primary taxing rights on most sources of income and gains.

Establishing Treaty Residency Through CoVI

This is straight forward if you no longer have a permanent home in the UK, however if you have a home here and a home overseas you will need to determine in which country your Centre of Vital Interests (CoVI) are, as your CoVI is likely to determine your treaty resident status.

Key Indicators to Prove Treaty Non-Residency

To support a claim to be a treaty non-resident of the UK an individual when reviewing CoVI they need to demonstrate that their connections abroad far outweigh any connections to the UK, this can be demonstrated by evidencing some of the following  indicators:

• Family have left the UK and are no longer resident here, if relevant
  
  
• Registered to vote overseas (deregister in the UK)
  
  
• Utility bills are registered and issued to your overseas address
  
  
• Bank statements are issued to an overseas address and bank is advised you have left the UK
  
  
• You are registered with a doctor and dentist overseas (deregister in the UK)
  
  
• Travel logs of visits from abroad are kept; particular note to the whereabouts and important events, such as Christmas, Easter, family weddings and bereavements

The above is just an example of a number of an exhaustive list of criteria which can or need to be kept so as to support a claim for treaty residence outside of the UK.

📞 For further advice on this matter please do not hesitate to get in touch.