The initial lack of a mass exodus of non-doms in the UK is misleading and does not accurately represent the financial impact. Payroll data fails to measure the migration of wealth, since many high-net-worth individuals do not earn UK salaries or pensions. Significant capital has already shifted into offshore investments and bonds since the non-dom status was abolished. Such shifts reduce taxable income and capital gains, impacting future UK tax revenue without being reflected in departure statistics.
Payroll data is a poor tool for measuring high-net-worth migration. It captures those with UK PAYE income, but many of the wealthiest non-doms do not take a salary or pension here.
Full clarity will only come with self-assessment data for the 2025-26 year - which won't arrive until January 2027. By then, the real fiscal hit will already be locked in.
Since the status was scrapped, significant sums have moved into offshore bonds. This is a straightforward, legal, and tax-efficient way to put assets outside the UK's income and capital gains tax net.
Large amounts of liquid cash have also been redirected into gilts and overseas investments. Both approaches reduce future UK tax receipts, but neither will ever appear in the 'departure' figures.
#tax-policy #non-domiciled-taxation #capital-migration #high-net-worth-individuals #offshore-investments
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