Non-dom reform missing from Finance Act
After announcing an early election, the government rushed to have the Finance Bill with the 2024 Spring Budget measures passed into law. However, one of the most notable of the reforms was missing. What's going on?
The 2024 Spring Budget included an announcement that the rules for “non-domiciled” individuals would be completely overhauled in 2025, with a residence-based test granting a short period of tax-free overseas income and gains for individuals moving to the UK. A detailed technical note was published shortly afterwards explaining how the new rules would work. However, following the announcement of the 4 July general election, the plans appear to have been abandoned. There are no clauses relating to the reforms in the Finance (No. 2) Act 2024, which received Royal Assent on 25 May 2024. So where does this leave non-domiciled individuals looking to clarify what their tax position will be?
It's likely that there will be some level of reform, regardless of who forms the new government next month. Unfortunately, that’s about all we can say for certain. Abolishing the non-domiciled status has long been a Labour policy and when the Spring Budget’s version of this was published, the party criticised perceived loopholes. So, it’s unlikely that reform will be abandoned completely. Hopefully we will get details of proposed changes in the run up to 4 July to enable planning with more certainty.
Related Topics
-
HMRC launches tax advisor register checker tool
HMRC has launched a new online tool allowing taxpayers to check whether their tax advisor is registered with it. The checker has been introduced shortly before new standards for tax advisors come into force. What does this mean for taxpayers and agents?
-
Could a special method increase your profits?
Your business has used the same partial exemption method for many years. Is it time to consider if a different method will improve your input tax recovery?
-
EVs and the tax-free mileage allowance
You’re a director and regularly use your electric vehicle (EV) for business journeys. Your company provides a workplace charger which is free for all staff to use. Does the origin of the electricity impact your claim for tax-free mileage?