Someone with non-domiciled status, sometimes called a ‘non-dom’, is a person living (i.e. resident for tax purposes) in the United Kingdom who is considered under British law to be domiciled (i.e. with their permanent home) in another country. This can have significant tax advantages for the wealthy.
How do you become non-domiciled?
You qualify if:
- your income from your overseas job is less than £10,000.
- your other foreign income (such as bank interest) is less than £100.
- all your foreign income has been subject to foreign tax (even if you did not have to pay, for example because of a tax-free allowance)
What does non-domiciled mean?
Meaning of non-dom in English abbrevation for non-domiciled: relating to the position of a person who lives in a country but does not have to pay tax there on money they have earned outside the country: The Treasury says there are about 116,000 residents with non-dom status.
When do you become a non domiciled UK resident?
Non-domiciled UK resident If you are living in the UK but are not actually domiciled in the UK you will become “deemed domiciled” for all tax purposes once you have been resident in the UK in at least 15 tax years out of the 20 tax years immediately before the year in question.
When do you need to consider non domiciled tax?
If you are a UK resident non-domiciled individual with foreign income and gains of more than £2,000 per tax year you will need to consider every tax year which of the two basis is more tax efficient for you. This is very important.
What happens if HMRC accepts non domicile status?
Acceptance by HMRC of an individual’s non-domicile status in one tax year does not preclude HMRC from opening an enquiry relating to a later tax year. In other words, a decision made by HMRC about an individual’s domicile status in relation to one tax year is not binding in relation to a later tax year.
When do you put domicile and residency together?
Domicile and residency usually go together but for certain taxation purposes (eg income tax or inheritance tax) your particular mix of residency, ordinary residency, domicile and domicile of origin will make a difference to what tax you have to pay.
