The end of non-dom in the UK: what changed for property owners

The British non-dom regime existed for more than two centuries and was one of the reasons wealthy foreigners chose London. From April 2025 it is abolished and replaced by a system tied not to domicile but to the length of tax residence. For an owner of British property that changes the calculation.

What it was

A UK resident without a UK domicile could pay tax on foreign income and gains only to the extent brought into the country — the remittance basis. That allowed years of living in London while leaving foreign income outside the British tax perimeter.

What it became

• Domicile as a criterion is abolished. Length of tax residence became the key.
• New arrivals get a limited favourable period — the first years after moving, during which foreign income and gains are exempt, provided the person was not UK tax resident for a set number of preceding years.
• After that period a resident is taxed on worldwide income on general terms.
• Inheritance tax has also moved to a long-residence test instead of domicile, including rules for those leaving the country.
• Transitional mechanisms exist for those who used the old regime — limited in time and in conditions.

Why this concerns property

British property was always subject to British taxes regardless of the owner's domicile: rental income, tax on sale, inheritance tax on residential property. The reform did not change that — it changed the surroundings, the economics of living in the country.

Some owners for whom London was home under a convenient tax regime are reconsidering how long they stay, and that shows up in the top of the market: in the supply of expensive properties and in demand from tenants willing to pay premium rates.

What an owner should do

• Separate two questions: the taxation of the property and the taxation of you as a resident. The reform touched the second.
• Count the residence period — it now determines the regime, and the day you cross the border matters.
• Review the ownership structure. Companies and trusts built for the old rules may have lost their point or become more expensive.
• Account for inheritance tax — historically one of the most sensitive items for owners of UK residential property.
• Check the rules at the date: transitional provisions are time-limited and some are already expiring.