Official Statistics

Statistical commentary on non-domiciled taxpayers in the UK

Updated 9 July 2024

1. Summary of key statistics

Figure 1: Aggregated numbers and liabilities for both non-domiciled and deemed domicile taxpayers

Key findings from this year’s publication are:

• There is continued evidence of a recovery in numbers of non-domiciled taxpayers since the height of the COVID-19 pandemic. The number of newly arrived non-domiciled taxpayers increased to 12,900 in tax year ending 2023, up 18% from 10,900 in tax year ending 2022

• In the tax year ending 2023, we estimate a combined total of at least 83,800 non-domiciled and deemed domiciled taxpayers are indicated in Self Assessment (SA) tax returns with combined tax and NICs liabilities of £12.3 billion. This is up 6% from 78,800 taxpayers and down 1% from £12.4 billion in liabilities in the previous tax year. While this represents a fall in number from pre-pandemic levels, the tax and NICs liabilities from this group remain higher than prior to the pandemic

• While around £109 million down from the figure for tax year ending 2022, the combined tax and NICs liabilities of £12.3 billion for tax year ending 2023 for all non-domiciled and deemed domiciled taxpayers is still the second-largest annual tax liability from this group since these figures began in 2018 (illustrated by Figure 1)

• At around £8.9 billion, the revenue from non-domiciled taxpayers is £474 million (or 6%) higher than in tax year ending 2022 and is at its highest level since tax year ending 2017

• Deemed domiciled taxpayers alone have UK tax liabilities of at least £3.4 billion in tax year ending 2023, so are liable for around 27% of the combined total for non-domiciled and deemed domiciled taxpayers. However, we are conscious that not all deemed domiciled taxpayers need indicate their status on their tax returns, so their liabilities are likely to be larger still

2. About this release

This publication is the annual update of statistics on individuals who are non-domiciled or deemed domiciled for tax purposes. To qualify as a non-domiciled taxpayer an individual must have their permanent home, their ‘domicile’, outside the UK. They must also claim non-domiciled status in the UK for tax purposes on their UK SA tax returns. Deemed domiciles are formerly non-domiciled taxpayers indicating on their UK SA tax returns that they are now treated as domiciled in the UK for the purposes of Income and Capital Gains Tax. This is following the 2017 change to end permanent non-domiciled taxpayer status in the UK for two groups:

1. non-domiciles who were either born in the UK and UK resident since tax year ending 2018, or

2. UK resident for at least 15 of the 20 tax years immediately before the relevant tax year.

This means it is important to consider both non-domiciles and deemed domiciles together when looking at trends over time.

Figures for tax years ending 2021, 2022 and 2023 are provisional (subject to future updates). All other figures are final (they will not be further updated).

From 6 April 2020, individuals, trustees and personal representatives of deceased persons who sell or otherwise dispose of UK residential property where Capital Gains Tax (CGT) is due on all or part of the gain have had to report the disposal to HMRC within 30 days of completing the disposal. At the same time they must make a payment on account of the CGT due. These statistics also include tax liabilities reported using the new Capital Gains Tax on UK property service for tax year ending 2021 onwards. We have found that the inclusion of this data increases annual tax liabilities by less than £10 million per tax year.

The historic data and tables remain available in the Government Web Archive.

3. Non-domicile policy changes

On 6 March 2024 the Spring Budget included an announcement to end the current tax rules for non-UK domiciled individuals from April 2025. This change is not therefore included in these statistics.

4. Non-domiciled taxpayers and taxes

Figure 2: Non-domiciled taxpayer numbers, Income Tax, Capital Gains Tax and National Insurance contributions

We estimate that in the tax year ending 2023, the amount of UK Income Tax, Capital Gains Tax and National Insurance contributions liable by all non-domiciled taxpayers was £8.9 billion, as shown in Figure 2. Despite the relatively small increase in the number of non-domiciled taxpayers since tax year ending 2022, the total amount of tax and NICs liabilities has increased by £474 million. This increase may have been caused in part by the temporary Health and Social Care levy, an additional 1.25 percentage points in NICs lasting from 6 April 2022 to 6 November 2022.

While the Income Tax and NICs paid by non-domiciled taxpayers both reached long-time highs in tax year ending 2023, CGT liabilities dropped to £384 million from £540 million in the previous year.

The majority of non-domiciled taxpayers in the tax year ending 2023 indicated UK residence as in previous years.

Figure 3: Number of non-domiciled taxpayers who have arrived into the UK in the previous five tax years

Figure 3 shows that for tax year ending 2023 there has been an increase of 7,300 in the number of newly arrived non-domiciled taxpayers compared to newly arrived non-domiciled taxpayers in tax year ending 2021. The temporary decrease in the number of newly arrived non-domiciled taxpayers in tax year ending 2021 is partly explained by the COVID-19 related travel restrictions affecting aviation, sea or rail travel into the UK. We have since seen the number of newly arrived non-domiciled taxpayers increase year-on-year, and it now sits at around 1,500 higher than the pre-pandemic level in tax year ending 2020.

Figure 3 also shows that the number of non-domiciled taxpayers who have stayed for a second year in tax year ending 2023 is 4,500 higher than in tax year ending 2022. This is partly due to the knock-on effect of fewer non-domiciled taxpayers coming to the UK in tax year ending 2021, when COVID-19 related travel restrictions were in place.

We estimate that there were 74,000 individuals claiming non-domiciled taxpayer status in the UK on their SA tax returns in the tax year ending 2023, up from 68,900 in the tax year ending 2022. The year-on-year increase in the number of non-domiciled taxpayers in tax year ending 2023 is partly explained by a continued recovery in new arrivals numbers and high retention rates stemming the outflow of non-domiciled taxpayers. However, the number of non-domiciled taxpayers has not yet fully recovered to the numbers seen prior to the pandemic, with the level in tax year ending 2023 still 3,600 below that in tax year ending 2020.

The following section suggests the fall in non-domiciled taxpayer numbers in the tax year ending 2018 is largely explained by the deemed domicile reforms introduced in April 2017 (labelled in Figure 4 as 2018). This meant that an individual who was formerly non-domiciled might be deemed domiciled for tax purposes if they were born in the UK and have a UK domicile of origin (Condition A), or if they were resident in the UK for at least 15 of the 20 tax years immediately before the relevant tax year (Condition B). This reinforces that we should look at numbers and tax paid by both non-domiciles and deemed domiciles together, particularly when looking at trends over time.

5. Deemed domicile reforms

Figure 4: Deemed domiciled taxpayer numbers, Income Tax, Capital Gains Tax and National Insurance contributions

Figure 4 shows 9,800 individuals indicated deemed domiciled taxpayer status in the UK on their SA tax returns in the tax year ending 2023. This is a reduction of around 100 on the number of deemed domiciled taxpayers in the tax year ending 2022 and follows a similar drop in tax year ending 2022. We have applied a late filing correction to the data for tax year ending 2023. This is consistent with our normal approach to publishing non-domicile figures for the current tax year as we are aware that late filing of tax returns does take place.

The number of deemed domiciled taxpayers is likely to be larger than this as there are different incentives to report for the different deemed domicile groups. Those under condition A who have a UK domicile of origin do not have access to the range of transitional protections that were available for condition B deemed domiciles who do not have a UK domicile of origin. Only the condition B deemed domicile group has a strong incentive to tell HMRC they consider themselves to be deemed and to continue to complete the SA109 form. This is to report to HMRC that they consider themselves to be maintaining a common law non-domicile status despite having been deemed to be UK domiciled in the UK tax system.

In the tax year ending 2023, deemed domiciles paid £3.382 billion of UK Income Tax, Capital Gains Tax and National Insurance contributions on worldwide income and liable gains. This is a drop from last year’s estimate of £3.965 billion. While NICs receipts increased from 2022, Income Tax and Capital Gains Tax both fell. The increase in NICs may be caused in part by the temporary Health and Social Care levy, an additional 1.25 percentage points in NICs lasting from 6 April 2022 to 6 November 2022.

This analysis shows that decreases in the number of non-domiciled taxpayers and tax liabilities in tax year ending 2018 can be explained by taxpayers becoming deemed domiciled in the UK. Despite the fall in Exchequer revenue exclusively from the non-domiciled population shown in Figure 2 since tax year ending 2018, Figure 1 shows any fall in revenue has been offset by the deemed domiciled taxpayers. However, for the first time since tax year ending 2018, in tax year ending 2023 the deemed domiciled taxpayers have been liable for less tax than in the previous tax year.

6. Guidance for interpretation of figures in this release

We have provided provisional figures for the tax year ending 2023 for Tables 1 to 4 only (in the accompanying spreadsheet). Figures for the three most recent tax years published may be revised in the future and the difference between them and previous years may be reduced or disappear. Further breakdown of the figures for the current year are not included as the source data is not complete enough to be a reliable indicator of longer-term trends (particularly where two successive years’ data points are close together as updates to the data in these instances may mean increases may change to decreases) and will be included in next year’s publication when the data is more settled. For the rest of this publication, we will discuss tax years up to tax year ending 2022.

7. Non-domiciled UK resident taxpayers, remittance basis and arising basis

The vast majority of non-domiciled taxpayers are UK-resident. For the tax year ending 2022, in Figure 5, the number of UK-resident non-domiciled taxpayers increased from 54,800 to 55,500, compared with an increase from 68,700 to 68,900 for all non-domiciled taxpayers (as seen in Figure 2). This may be a recovery from the effect of the COVID-19 pandemic travel restrictions in tax year ending 2021, given that we are publishing a year in arrears, rather than for the most recent tax year ending 2023. The UK-resident non-domiciled group is taxed on two bases: a remittance basis or an arising basis.

Individuals who are UK-resident are normally taxed on the arising basis of taxation, so that all of that individual’s worldwide income and gains are taxable in the UK as they arise. Some non-domiciled taxpayers who are UK-resident may choose to be taxed on the remittance basis, meaning that any foreign income and gains will only be taxed if they are brought, or remitted, into the UK, even if that remittance occurs in a later tax year. For non-domiciled taxpayers who opt to be taxed on the remittance basis, any foreign income and gains that are not remitted to the UK are not subject to UK tax.

Those taxed on a remittance basis make up a larger proportion of non-domiciled UK residents. Figure 5 shows that the number of non-domiciled taxpayers on the arising basis has been broadly stable since 2018. The number of non-domiciled taxpayers on the remittance basis was broadly stable from tax years ending 2018 to 2020, but dropped in tax year ending 2021 and continues at this lower level in tax year ending 2022. This may largely be due to COVID-19 pandemic travel restrictions, though we are seeing evidence of a recovery in numbers.

Figure 5: Number of non-domiciled UK residents claiming the remittance basis or the arising basis of taxation

Tables 5 and 6 in the accompanying spreadsheet contain the information for total UK Income Tax, CGT and NICs contributions for the UK-resident non-domiciled taxpayers claiming the remittance basis and also the arising basis.

Please note Tables 5 and 6 will not include some individuals who pay tax on the arising basis without indicating non-domiciled or deemed domiciled status on the SA return. This includes taxpayers who were considered non-domiciled, but are now deemed to be domiciled and have moved onto the arising basis.

The number of taxpayers on the arising basis and their taxes and NICs liabilities dropped substantially between tax years ending 2016 and 2017 and continued to fall in subsequent years.

However, this fall has now ended. In tax year ending 2021 there were 17,500 non-domiciled taxpayers on the arising basis liable for a total of £1.560 billion in taxes and NICs, compared to 17,600 non-domiciled taxpayers on the arising basis liable for a total of £1.917 billion in taxes and NICs in tax year ending 2022.

8. Remittance basis and the remittance basis charge

8.1 Population changes

The number of non-domiciled taxpayers paying on the remittance basis was 37,800 in the tax year ending 2022. We expect to revise this in future years due to a small number of late filers.

Figure 6 shows an increase of around 500 in the number of remittance basis claimants in tax year ending 2022. While the number of those on the remittance basis but not paying the remittance basis charge has fallen, both the number of those paying the remittance basis charge and those on the remittance basis who have less than £2,000 of unremitted overseas income have increased. It is these groups that are jointly responsible for the overall increase. This may be showing a recovery from the COVID-19 pandemic and related travel restrictions.

Table 7 shows that only a minority of the taxpayers who are using the remittance basis are liable to pay the RBC. This is because the RBC is only levied when a remittance basis user has been UK-resident for at least 7 of the previous 9 tax years immediately before the relevant tax year. It is also not payable where a taxpayer using the remittance basis has less than £2,000 of unremitted non-UK income or gains. We have provided a breakdown for this group in Table 8.

8.2 Remittance basis claimants and taxes

Figure 6: Number of non-domiciled UK resident taxpayers taxed on the remittance basis and their Income Tax, Capital Gains Tax and National Insurance contributions

Non-domiciled taxpayers on the remittance basis in the tax year ending 2022 are liable to pay £6.452 billion in Income Tax, Capital Gains Tax and National Insurance contributions (Table 5). This is an increase from tax year ending 2021 of £223 million and remains below the high point in the tax year ending 2017, though it does remain above the pre-pandemic level of tax year ending 2020. A large majority of this increase can be explained by the sub-group population of non-domiciled taxpayers who are on the remittance basis but do not pay the remittance basis charge. In comparison, the increases in tax and NICs paid by those paying the remittance basis charge and those on the remittance basis with less than £2,000 of unremitted income were relatively small.

As has been explained, higher tax and NICs liabilities from deemed domiciled taxpayers more than offset the decrease in remittance basis user liabilities that followed the tax year ending 2017.

9. Remittance basis charge revenue

Figure 7: Non-domiciled UK resident taxpayers liable to pay the remittance basis charge and UK Income Tax, Capital Gains Tax, National Insurance contributions and remittance basis charge revenue

Figure 7 shows the number of taxpayers who were liable to pay the RBC rose from 1,800 in the tax year ending 2018 to 2,400 in the tax year ending 2022. The total amount to be paid by taxpayers in Income Tax, CGT, NICs and the RBC also rose from £838 million from those who were liable to pay the RBC in the tax year ending 2018 to £1.274 billion from those who were liable to pay the RBC in the tax year ending 2022.

This shows that the number of remittance basis users who are staying resident in the UK long enough to pay the RBC has been increasing since the 2017 deemed domicile reforms, with their tax and NICs liabilities increasing by around £38 million in tax year ending 2022 on the previous tax year.

The accompanying background quality report provides more details on the remittance basis charge and deemed domicile changes.

10. Non-domiciled taxpayers by region

10.1 Regional observations

London continued to have the largest non-domiciled taxpayer population in the tax year ending 2022, with 58% of non-domiciled taxpayers in the UK located in that region and 75% of non-domiciled UK Income Tax, CGT and NICs coming from that region. This information is shown in the accompanying spreadsheet in Table 11. London also had the largest population of UK-resident non-domiciled taxpayers.

11. Business Investment Relief in the UK

Figure 8: Value of business investment relief and number of claimants

Figure 8 shows that in the tax year ending 2022, the cumulative value of investments in UK businesses on which Business Investment Relief (BIR) has been claimed since BIR began in 2012, is £8.198 billion. In the tax year ending 2022, £1.160 billion was invested in the UK from 500 taxpayers which is up by around £422 million from the previous year.