If you’re a high net worth individual, you might have considered moving from the UK to a new country to benefit from more favourable tax rules.
Research shows that an increasing number of wealthy people are doing this, with Sky News revealing that over 10,000 millionaires left the UK in 2024 – a 157% increase from 2023. This meant that the UK lost more wealthy people than any other country bar China.
While various financial factors undoubtedly contributed to this, changes to the UK’s non-dom tax rules could be one of the main reasons behind the trend.
Indeed, following the initial plans to abolish non-dom tax rules from the previous Conservative government, the new chancellor, Rachel Reeves, eventually backtracked somewhat after committing to the reforms.
This might have contributed to the uncertainty, and you may now be concerned about what your tax status will be if you choose to remain in the UK. If you’re considering a move abroad – whether that’s for tax reasons or job opportunities – careful planning is vital.
Continue reading to discover why so many millionaires have left the UK, and four essential considerations to keep in mind if you’re thinking of doing the same.
Non-dom tax changes could partly be the reason why so many millionaires are leaving the UK
Non-domicile, or “non-dom” as it’s commonly referred to, is a term used to describe someone whose permanent home is outside of the UK for tax purposes.
As such, a non-dom would ordinarily only pay tax on money they earn in the UK, meaning that wealthy people could save money by nominating a country with a lower rate of tax as their domicile.
In March 2024, the former chancellor, Jeremy Hunt, announced that the non-dom tax rules would eventually be phased out. He stated that, from April 2025, new arrivals to the UK would not have to pay tax on foreign earnings for the first four years.
Then, they would be taxed like any other UK resident. Meanwhile, existing non-doms would have a two-year transition period where they would be encouraged to bring their wealth into the UK.
When the Labour Party came to power in 2024, Rachel Reeves reaffirmed the government’s commitment to the reform of the non-dom rules.
She revealed that the UK would instead replace them with a residence-based scheme for those who move to the UK on a temporary basis.
However, in January 2025, Reeves changed her stance at the World Economic Forum in Davos, allowing a longer transition period and reducing tax on overseas income for the next three years.
Despite this, many high net worth individuals have already decided to leave the country, and it remains to be seen whether Reeves’ changes will be enough to entice them back.
4 financial factors to consider if you’re planning to move
If you’re considering a move abroad, there are several vital financial factors to keep in mind beforehand – read on to discover four of these.
1. Fully understand tax implications before you move
Depending on where you plan to move to, the tax rules of your destination country could vary significantly from the UK. Due to this, it’s vital to understand the tax implications before you make a decision.
For instance, some countries have double tax agreements with the UK, meaning that any income taxed in one country won’t be taxed in another.
However, this is not the same for every country across the board, and failing to plan properly could mean you face higher-than-expected tax bills.
What’s more, you should also note that different countries might have varying forms of taxation.
Indeed, while some nations – such as Switzerland – might offer lower Income Tax rates, they have alternative systems in place to generate revenue, namely a wealth tax.
As such, ensuring that you’re fully aware of how your wealth will be taxed ahead of time could help you make more informed decisions.
2. Plan for any eventuality
Before deciding to move, it’s important to take more than just tax into account. In fact, planning ahead for any eventuality could potentially help you avoid several financial pitfalls.
For example, while it might be prudent to open a bank account in your planned new country of residence before you move, you may still want to maintain at least one account in the UK.
This could help you deal with any ongoing bills while you’re away – such as for loans and credit card debt – or make it easier to transition back if you plan to return to the UK in the future.
Additionally, if your income will be in a different currency after the move, you may want to think carefully about how your earnings might change, as this could potentially affect your long-term stability.
If you have protection in place in the UK, it’s practical to ensure that it's still valid in your new country. Otherwise, you might face financial difficulties should the unexpected arise.
It’s also worth figuring out whether you need to adjust your savings and investment portfolio, as some UK-based tax-efficient investment accounts – such as your ISA – might not be transferrable once you move abroad.
3. Keep your pension savings in mind
Since retirement is such a significant milestone in your life, it’s essential to carefully consider your pension plans before you make the move abroad.
While you would normally still be eligible for the State Pension after you relocate – provided you’ve accumulated enough “qualifying years” on your National Insurance record while you worked in the UK – you may not benefit from any annual increases from the triple lock.
Just note that this might still be available if you move to a country within Europe or one with a tax agreement with the UK.
Since the State Pension can form the bedrock of your retirement income, it might be worth ensuring the rest of your plan is watertight. Some of the factors worth considering include:
- Keeping your pension wealth in the UK, especially if you plan to move back in the future
- Transferring your retirement fund to a qualifying recognised overseas pension scheme (QROPS), which could offer tax advantages depending on your new country of residence
- Exploring alternative ways to invest your pension fund that align with your long-term retirement goals.
By figuring out which of these options best suits your unique circumstances, you could potentially mitigate unnecessary taxes and ensure your financial security in retirement.
4. Seek professional advice
As you can see, navigating some of the financial complexities of a big move can be challenging. Due to this, it’s worth seeking professional advice both before and after you relocate.
A financial planner could help you:
- Structure your finances to minimise your tax liability and ensure you remain compliant with local tax rules
- Advise you on tax-efficient investment accounts in your new country that are still aligned with your risk profile and long-term goals
- Evaluate whether a QROPS or other international pension scheme is right for you.
Wherever you plan to relocate, working with an experienced planner could offer some much-needed peace of mind and ensure that your move is as seamless as possible.
Email enquiries@alexanderpeter.com or give us a call on +44 1689 493455 to find out how we can help you.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
All information is correct at the time of writing and is subject to change in the future.
Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.
The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.
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