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Effective April 6, 2025 · Published June 11, 2026

UK FIG Regime: Non-Dom Abolition & What Family Offices Must Know

Affects: United Kingdom

From 6 April 2025, the UK's long-standing non-domicile tax status is abolished and replaced by the Foreign Income and Gains (FIG) regime. Under FIG, individuals who have not been UK tax resident in any of the ten preceding tax years qualify for a four-year exemption window during which foreign income and gains are fully sheltered from UK tax, regardless of whether funds are remitted to the UK. Once the four-year period expires, all worldwide income and gains become taxable in the standard way, with no remittance-basis option available.

Alongside FIG, a Temporary Repatriation Facility (TRF) allows individuals who previously claimed the remittance basis to bring pre-April 2025 foreign income and gains into the UK at reduced tax rates for a limited window. Inheritance tax treatment of non-UK assets is also fundamentally restructured, shifting from a domicile-based test to a long-term residence test, broadly affecting individuals who have been UK resident for ten or more years out of the preceding twenty.

Who is affected

  • Individuals newly arriving in the UK who have been non-resident for at least ten consecutive tax years, they are the primary beneficiaries of FIG's four-year exemption.
  • Long-standing UK residents who previously claimed the remittance basis, they lose that protection entirely and face worldwide taxation from 6 April 2025.
  • Family office structures holding offshore trusts, holding companies, or foreign investment vehicles on behalf of settlors or beneficiaries with UK connections, particularly where inheritance tax exposure has historically been managed through domicile planning.

Key changes

  • Remittance basis abolished: pre-existing remittance-basis users are now taxable on worldwide income and gains as they arise, without a remittance trigger.
  • FIG four-year exemption: newly qualifying arrivals can elect to exclude all foreign income and gains from UK tax for up to four tax years, with free remittance of those amounts to the UK during that window.
  • Inheritance tax restructured: liability on non-UK assets now follows a long-term residence test rather than domicile, materially broadening the IHT net for long-term residents while potentially releasing certain shorter-term residents from prior exposure.
  • Temporary Repatriation Facility: a transitional mechanism, available for a limited period after April 2025, enables remittance-basis users to remit previously sheltered foreign funds at reduced tax rates, the specific rates and window duration are set out in the Finance Act.

Recommended action

A family office should immediately map which principals, settlors, and beneficiaries are affected by each transition category, newly qualifying FIG arrivals, lapsed remittance-basis users, and those approaching the long-term residence IHT threshold, and engage specialist UK tax counsel to assess TRF elections, trust restructuring needs, and any required changes to investment holding structures without delay, as several of the transitional windows, including the Temporary Repatriation Facility, are time-limited and run only for a defined number of tax years from 6 April 2025.

Sources

  1. [1]Abolition of the remittance basis and introduction of the Foreign Income and Gains regime— HM Revenue & Customs
  2. [2]Finance Act 2025— UK Parliament / legislation.gov.uk
  3. [3]Changes to the taxation of non-UK domiciled individuals — consultation and policy documents— HM Treasury