On 31 August 2017 HMRC released statistics on non-domiciled taxpayers in the UK from 2007/08 to 2014/15. This is the first time that comprehensive statistics on non-domiciled taxpayers in the UK have been published and this will now become an annual publication. The statistics may be revised in future years owing to late tax returns.

Non-domiciled taxpayers

The concept of domicile under UK general law refers to the country that a person ultimately considers as home. Each person has a “domicile of origin” at birth, this being the jurisdiction that is regarded as home by a parent at the time of their birth. Until the age of sixteen an individual’s domicile will depend on the domicile of the person they are legally dependent upon. An individual is however entitled to later acquire another jurisdiction as a domicile, known as the “domicile of choice”, in the country where that person has decided to settle down and regards as a permanent home.

Individuals who are not domiciled in the UK may elect to pay UK tax on income and gains arising in the UK or remitted to the UK from abroad (known as the remittance basis). This is more favorable treatment than the taxation of individuals resident and domiciled in the UK who must pay income tax on their worldwide income. However if a non-domiciled individual has been resident in the UK for a certain number of years that person must pay the “remittance basis charge” if electing for taxation on the remittance basis. The level of the remittance basis charge varies according to the number of years the individual has been resident in the UK.

Tax paid in 2014/15

Around 121,300 individual taxpayers were claiming non-domiciled status on their UK self-assessment tax returns in 2014/15. Of these non-domiciled taxpayers 85,400 were UK resident and 35,800 were non-resident. In 2014/15 non-domiciled taxpayers paid GBP 6,747 million in income tax; GBP 2,252 million in capital gains tax and GBP 2,253 million in national insurance contributions. Of this amount the UK resident non-domiciled taxpayers paid GBP 6,533 million in income tax, GBP 250 million in capital gains tax and GBP 2,217 in national insurance contributions.

Of the 85,400 UK resident non-domiciled taxpayers 54,600 were taxed on the remittance basis in 2014.15 and they paid GBP 4,989 million in income tax; GBP 165 million in capital gains tax; and GBP 1,735 million in national insurance contributions. The remaining 30,900 UK resident non-domiciled taxpayers were not taxed on the remittance basis and were therefore subject to tax on the arising basis of taxation.

Of the 54,600 UK resident non-domiciled taxpayers that were taxed on the remittance basis in 2014/15 5,100 were liable for the remittance basis charge. In 2014/15 they paid GBP 1,393 million income tax; GBP 129 million in capital gains tax; GBP 304 million in national insurance contributions and GBP 226 million in remittance basis charges.

Of the 5,100 UK resident non-domiciled taxpayers paying the remittance basis charge in 2014/15 1,300 had been resident in the UK for at least seven of the previous nine years and therefore paid the remittance basis charge of GBP 30.000 in that year. 3,700 taxpayers paying the remittance basis charge in 2014/15 had been resident in the UK for at least twelve of the previous fourteen years and therefore paid the GBP 50,000 remittance basis charge.

Further tables of information issued by the UK government show a regional breakdown of UK resident non-domiciled taxpayers indicating that of the 121,300 UK resident non-domiciled taxpayers 62,900 were living in London in 2014/15. Statistics are also published for the number of non-domiciled taxpayers claiming business investment relief and the amount invested in UK qualifying companies using the relief.