There was much debate yesterday about the Labour Party’s suggestion that they would abolish non-dom status if they come to power after the election.
Non-doms are generally foreign and often derive their status from being born to a parent who had a non-UK domicile at the time of their child’s birth. If that child comes to live in the UK, but does not intend to make their permanent home here, then they will generally retain their non-UK domicile acquired on their birth.
This status carries certain tax advantages. For example, a non-dom would have to live in the UK for 17 out of 20 tax years before his non-UK assets became subject to Inheritance Tax on his death. In addition, a non-dom is only liable to tax on his foreign income and capital gains if and when they are remitted to this country, although once resident here for a long period he becomes liable to a sizeable annual tax charge in order to take advantage of the remittance basis.
It was alleged yesterday that non-dom status is inherited. See why this might have been said and read greater detail on this subject in our article coming to our News section soon.