Here's your checklist of things to consider if you are leaving the UK

For a long time, the UK has been a magnet to successful people. The so-called 'non-dom regime' has allowed individuals who are not domiciled in the UK ('non-domiciliaries') to move to the UK without immediately becoming subject to tax on their income and gains from outside the UK.

However, all good things must come to an end.  The future of the non-dom regime has been brought into question.  Concerns over the possibility of this occurring, on top of Brexit and economic uncertainty, may already be causing some non-domiciliaries to exit, with a recent report by Henley & Partners indicating a net migration of high-net-worth individuals.  

Speculation aside, there are many reasons why individuals choose to leave the UK.  Indeed, it's worth noting that every non-domiciliary must have a clear intention to depart, lest they become actually domiciled.  If this intention does not translate into action before 15 years have passed, then a non-domiciliary will find themselves 'deemed domiciled' for tax purposes.

A checklist for leavers

Whatever your reason for leaving, doing so deserves the same careful planning as moving to the UK.  With that in mind, below is a list of things to consider.

• Where are you going?  Both the immigration requirements and the tax system of your prospective home should be considered.  Whilst some jurisdictions impose high tax rates across the board, others offer attractive regimes to incoming individuals; we consider a few in Part 1 and Part 2 of our article 'How does the UK Non-Dom regime compare to other jurisdictions?'.  In any case, some form of pre-arrival planning is essential.  
• When are you leaving? The day on which you leave the UK, together with certain other relevant factors, will determine when you cease being tax resident in the UK.  Your new home will have its own rules for determining when you become resident.  Your tax planning will centre around these dates, so it's important that you have them in mind when you plan your move.
• Will you visit the UK?  If you do, it's crucial that you know how many days you can spend in the UK each year without becoming tax resident again under the UK's statutory residence test.  Unplanned tax residence can have major consequences.
• Might you become UK resident again?  It's important to be aware that actions you take whilst non-UK resident can have tax implications if you become resident again.  By way of example, you may be taxed on certain disposals made during your absence, depending on how long you were out of the country.  There are steps you can take to optimise your position in the event that you do decide to return.  It will be particularly important to review any wealth-holding structures you establish, to ensure they do not attract adverse treatment in the UK.
• What's your domicile status?  Whilst you are resident, it's important to be conscious of your domicile position and (assuming you remain non-UK domiciled) to know when you will become deemed domiciled for tax purposes.  You can find out more about this in our article 'Why does domicile matter in the UK?'.  If you do become deemed domiciled, then three complete tax years of non-residence will be required before you can lose this status.  You will need to be cautious in implementing any planning (e.g. making gifts or settling trusts) before this time has passed.  
• Will you retain a property or other assets in the UK? Be aware that, even if you are neither resident, domiciled nor deemed-domiciled in the UK, you may nevertheless have tax liabilities associated with assets you own in the UK.  For example, if you have a house, you will be subject to Income Tax if you let it out, Non-resident Capital Gains Tax if you sell it, and your estate may be liable for Inheritance Tax on it (and on any other UK situated assets) when you die.  You should also consider the succession of these assets and make a Will, if you have not already done so.
• Does HMRC know you've left? Even if you don't owe any tax following your departure, you could nevertheless be penalised for not filing a tax return if HMRC issue a notice to file.  To avoid issues, you should report your non-residence and ensure that any official mail can reach you.

The above is by no means exhaustive, so it's important that you obtain the right advice to allow for a graceful exit from the UK and a soft landing in your new home.  We have extensive experience helping clients move between the UK and other countries, ensuring they avoid the many pitfalls whilst making the most of the opportunities available to them.