On 12 April 2022 the UK government published a summary of the responses to the consultation on corporate re-domiciliation.

The UK aims to introduce a regime to enable companies to move their domicile to, and relocated to, the UK. Re-domiciliation would allow companies incorporated abroad to change their place of incorporation while keeping their legal identity. This would permit continuity of business operations while redomiciling; and would reduce the amount of administrative complexity involved in other methods of relocating to the UK.

The consultation launched in October 2021 requested comments on the advantages of allowing companies to re-domicile; how much demand there might be for re-domiciliation; the types of companies and sectors that might use the new rules; and on any wider issues such as administrative hurdles or financial barriers to re-domiciliation. Under the proposed rules re-domiciliation would only be possible from countries that allow outbound re-domiciliation.

Respondents to the consultation generally agreed with the proposals to introduce a corporate re-domiciliation regime and considered that the current methods to relocate companies are complex and expensive. They also generally considered that the new rules alone would not be sufficient to attract foreign companies and a favourable business environment would be the main factor in motivating foreign companies to re-domicile to the UK.

Some responses to the consultation indicated that more details of the proposed regime were necessary to enable them to offer a definitive response. The consultation document set out a general summary of the proposed rules without including details of the practical design and implementation.

The rules would need to be flexible and there would need to be a balance between simplicity of design and appropriate checks and procedures. More clarity was therefore required on the practical procedures to be put in place by the new the regime. The respondents emphasised the need for predictability and certainty.

Most commentators were in favour of a two-way regime that would allow both inward and outward re-domiciliation. Under the principle of reciprocity another jurisdiction might not permit re-domiciliation of its companies if the UK did not permit companies to re-domicile overseas. The level of potential demand for outward re-domiciliation from the UK is unclear.

The commentators mostly supported the view that re-domiciled companies should receive the same tax treatment as companies incorporated in the UK. The new regime should be simple to operate and should be consistent with the current tax rules in the UK, but there was no need to create a new tax category for re-domiciled businesses. A detailed analysis of the tax implications of re-domiciliation could only be performed when the full details of the new regime were known.

Most respondents agreed that the attractiveness of re-domiciliation to the UK would be significantly influenced by the tax rates in the UK compared to those in other countries with similar regimes. Commentators also noted that there would be personal tax implications from re-domiciliation.