For over 200 years, “non-dom” was the anchor concept of UK cross-border tax planning. From 6 April 2025 it stopped being one. The UK has not simply trimmed a relief — it has replaced the entire organising principle for internationally mobile individuals with the UK FIG regime (Foreign Income and Gains regime).
Domicile is gone from the income tax, capital gains tax and inheritance tax system. In its place sits a residence-based framework built around two very different clocks: the new 4 year FIG regime UK rules for new arrivals, and a much longer 10-out-of-20-year “Long-Term Resident” test for inheritance tax.
Much of the commentary since the Autumn 2024 Budget has repeated the headline — “non-dom abolished, FIG regime introduced” — without explaining what the UK tax FIG regime actually means for someone deciding whether, when, or how to come to the UK.
This article is the UK FIG regime explained in the order that matters practically: who qualifies, which tax year they are in, which foreign sources are affected, and what happens once the four-year window closes.
The FIG regime — HMRC’s shorthand for what is formally called the Residence-based Foreign Income and Gains regime — is the residence-based replacement for the old non-dom remittance basis, in force since 6 April 2025.
In short: an individual who has been non-UK resident for at least the previous ten consecutive tax years can, for their first four UK resident tax years, have qualifying foreign income and gains relieved from UK tax entirely — whether or not that money is brought into the UK.
In this sense, the UK FIG regime is best understood as a time-limited exemption for new arrivals, not a continuation of the old non-dom status, and not something every non-dom automatically carries forward.
As a general rule, yes. A UK tax resident is taxable on worldwide income and gains as they arise, foreign income included — that has not changed.
What determines how foreign income is taxed in the UK is not whether it is foreign, but which of a small number of reliefs might apply to it: ordinary foreign tax credit relief under a double tax treaty, remittance basis transitional protection where it still applies, or — for a qualifying new resident within their four-year window — full relief under the FIG regime.
Absent one of those, foreign interest, dividends, rental profits and capital gains are reported and taxed in the UK exactly like their domestic equivalents.
Before 6 April 2025, the starting point was domicile, not residence. A UK resident individual who was non-UK domiciled could claim the remittance basis of taxation. Broadly, UK income and gains remained fully taxable, while foreign income and gains stayed outside UK tax provided they were not remitted — brought into or enjoyed in the UK.
That single rule shaped an entire industry of planning: offshore accounts, trust capital, mixed funds, and the painstaking tracing of “tainted” money to work out what could safely be brought onshore.
Longer-term residents paid for the privilege — the remittance basis charge, and eventually deemed domicile after 15 of the previous 20 tax years, brought non-doms back into worldwide taxation regardless of remittances. The regime was complex, but the anchor was clear: domicile plus remittance. The movement of money into the UK was itself the tax-triggering event.
The starting question is no longer “where is this person domiciled?” It is a sequence of residence-based tests:
Someone who satisfies all three is a qualifying new resident, and eligible foreign income and gains arising in that window may be relieved from UK tax if a claim is made.
This is not an automatic exemption and it is not a family-wide election — it is made individual by individual, and different members of the same household can make different choices depending on their own circumstances and sources.
The other structural change is what happens to remittances. Under the UK FIG tax regime, once qualifying foreign income or gains have been relieved, bringing that money into the UK does not trigger a remittance basis charge.
The mechanics are simpler than the old regime; the trade-off is that the relief is sharply time-limited. The planning question has flipped from “did I remit this?” to “do I qualify, and which sources am I claiming relief on?“
It is worth being explicit about a common misreading: the FIG regime UK tax rules are not a blanket four-year extension of the old non-dom status for everyone who previously claimed the remittance basis.
A long-standing UK resident non-dom who does not satisfy the new ten-year prior non-residence condition is simply within the worldwide arising basis from 6 April 2025, full stop — regardless of how the remittance basis worked for them previously.
For a qualifying new resident, eligible FIG can be relieved from UK tax for up to four UK tax years under the 4 year FIG regime UK rules — not 48 months from the date of arrival, but four tax years, which can mean the effective relief period is shorter than four full years if arrival falls partway through a tax year.
The window runs continuously from the point eligibility starts; time spent outside the UK during those four years is not “banked” for later use.
Claims are made on a source-by-source basis. An individual designates specific amounts of qualifying foreign income and gains for the year; anything not designated is simply taxed in the ordinary way.
There is, however, an important constraint on how granular that choice can be: the designation has to follow the source, not the asset within it.
An individual with several rental properties generating the same type of income cannot include one property’s rental income in the claim while excluding another’s — if a source is included, it is included in full.
The claim also has a cost that is easy to overlook. Making any FIG claim removes entitlement to the UK personal allowance and the capital gains tax annual exempt amount for that entire tax year — not just against the designated income.
That all-or-nothing consequence needs to be weighed against the tax saved before a claim is made.
One of the most common misunderstandings among new arrivals — particularly those moving to the UK with an existing equity package — is the assumption that Restricted Stock Units (RSUs), stock options, and similar awards will simply fall within the FIG regime because the award was granted while the individual was living, and paying tax, elsewhere.
They generally do not, and the reason lies in how UK tax law characterises the award, not in any gap in the FIG regime itself.
Vesting is employment income, not FIG. RSUs are taxed in the UK when they vest, not when they are granted.
Where vesting spans a period of both UK and non-UK employment, the gain is apportioned — typically by reference to workdays between grant and vest — and the UK-apportioned share is taxed as employment income through PAYE.
Because the FIG regime relieves foreign income and gains, not earnings from employment, the vesting gain sits outside its scope entirely, regardless of how the individual otherwise qualifies.
Relief for the non-UK portion of employment earnings, where available, instead falls under Overseas Workday Relief (OWR) — a separate relief running on the same four-year window as FIG, but with its own conditions and its own cap (the lower of 30% of qualifying employment income or £300,000 a year, as set out above).
HMRC’s guidance on OWR and qualifying foreign securities income deals specifically with equity awards of this kind.
A later sale is a capital gain, but the same apportionment logic can follow it. Once RSUs vest and the underlying shares are acquired, any further increase in value between vesting and eventual sale is, in principle, a capital gain, and capital gains are within the scope of FIG to the extent they are foreign-sourced.
In practice, HMRC’s approach to internationally mobile employees’ share awards means that gain can itself be split by reference to the same UK/non-UK apportionment applied at vesting.
The portion treated as attributable to UK duties remains UK-sourced and outside FIG regardless of the claim; only the genuinely foreign-sourced portion of the post-vesting gain is something a FIG claim can reach.
For anyone with a mixed UK/overseas vesting history, the practical result is that a meaningful slice of both the vesting gain and the eventual sale gain can stay taxable in the UK no matter how the FIG position is claimed — and the apportionment itself is specific enough to the individual’s award terms and workday history that it needs to be worked through on the facts rather than assumed.
Take a qualifying new resident with £65,000 of UK employment income and £25,000 of foreign interest income, for total worldwide income of £90,000, taxed at UK rates for 2025/26.
Without a FIG claim: both sources are taxable in the UK and the personal allowance of £12,570 is available in full. Total UK income tax comes to £23,432.
It’s tempting to assume that relieving the £25,000 of foreign interest simply removes the tax attributable to it — in this case, around £10,000, leaving a bill of roughly £13,432. That assumption ignores the cost of the claim itself.
With a FIG claim: the £25,000 of foreign interest is relieved from UK tax, but the personal allowance is lost for the whole tax year — not tapered, not restricted to the claimed income, gone entirely. Total UK income tax on the remaining £65,000 of employment income, now with no personal allowance at all, comes to £18,460.
The actual saving is £4,972 — less than half the £10,000 headline figure, because losing the personal allowance costs £5,028 on its own (the full £12,570 falls into this individual’s 40% marginal band).
The lesson holds generally: the larger the UK-taxable income sitting alongside the foreign income being relieved, the more of the FIG saving the lost personal allowance quietly claws back — sometimes to the point where the claim is barely worth making for a given year.
These three concepts get conflated constantly, and the distinction matters for anyone advising on or claiming the relief:
The practical consequence: the moment FIG relief is claimed on a source, the secondary claim for foreign tax credit on that same source falls away.
A cross-border tax adviser, accountant or CPA should not treat “the client qualifies for FIG” as equivalent to “the client should claim FIG on everything” — the existing foreign tax profile can change the right answer source by source.
The worked example above is worth revisiting for one specific group: US citizens and green card holders, who remain taxable by the United States on worldwide income regardless of where they live.
For this group (or for anyone else from a country that taxes its citizens on their worldwide income based on their nationality) — a large share of the people we advise on moving to the UK from the USA — a UK tax saving from a FIG claim is not automatically a saving overall, because the US side of the calculation moves in response to what happens on the UK side.
Ordinarily, where the same foreign interest income is taxed in both the UK and the US, a US citizen would look to the foreign tax credit (via Form 1116) or the US-UK tax treaty to reduce or eliminate the double taxation — the US tax on that income is offset, in whole or in part, by the UK tax already paid on it.
Once the £25,000 of interest in the example above is relieved under FIG, however, there is no UK tax left on that income to credit against the US liability.
The foreign tax credit protection that would otherwise have absorbed some or all of the US tax simply isn’t there, and depending on the individual’s overall US position, the categorisation of the income, and any applicable Form 1116 limitations, some or all of the US tax on that £25,000 can resurface in full.
The result is that the right question for a US citizen is never simply “how much UK tax does the FIG claim save?” It is “what happens to the combined UK and US tax bill?“
A UK saving of £4,972, as in the example above, could be partly or wholly offset by additional US tax that would not otherwise have arisen — or, depending on the individual’s US tax position, it might not be offset at all.
Either way, the UK-side number alone is not a reliable answer, and any US citizen or green card holder considering a FIG claim should have both sides of the calculation modelled together, ideally with US tax advice run alongside the UK analysis, before the claim is made.
This is arguably the most misunderstood part of the reform, because there are now two separate timelines running in parallel, and they should never be conflated:
Clock one — income tax and capital gains tax. For qualifying new residents, eligible FIG may be relieved for the first four UK resident tax years. After that, the normal worldwide arising basis becomes the starting point, full stop.
Clock two — inheritance tax. From 6 April 2025, the UK moved from domicile as the connecting factor for overseas assets to a Long-Term Resident (LTR) test based broadly on having been UK resident for 10 out of the previous 20 tax years.
Once LTR status is acquired, worldwide assets — not just UK assets — come within the scope of UK IHT.
Critically, LTR status does not switch off the moment someone leaves the UK: a “tail” period continues to apply after departure, ranging from a minimum of three years up to ten years depending on how long the individual had been UK resident.
The result is that someone can be well outside the four-year FIG window on the income tax side while still being nowhere near LTR status for IHT purposes — or, after several years of UK residence, can find themselves inside the IHT net long after their FIG relief has run out and even after they have left the country.
These are genuinely separate questions with separate timelines and separate consequences, and treating them as one issue is a common and costly error.
For individuals who previously built up untaxed foreign income and gains under the old remittance basis, the government introduced a transitional relief: the Temporary Repatriation Facility.
Running for three tax years from 6 April 2025 (2025/26 to 2027/28), it allows FIG that arose while the individual was a remittance basis user to be designated and brought into the UK at a reduced flat rate — 12% for 2025/26 and 2026/27, rising to 15% for 2027/28 — rather than at full marginal rates, and without triggering the old remittance basis charge machinery.
There are important limitations. No credit is available for foreign tax already paid against the TRF charge itself, so the amount designated should be calculated net of foreign tax where relevant.
Distributions from offshore trust structures received on or after 6 April 2025 are treated differently under the TRF than income and gains arising directly to the individual — the interaction with trust distributions, mixed funds and Business Investment Relief is one of the more technically involved areas of the reform and generally warrants specific advice rather than generalisation.
This is where the reform becomes structural rather than mechanical, and it is the area most likely to catch out families with pre-existing offshore planning.
Under the old regime, “protected trust” status could shield qualifying foreign trust income and gains from immediate attribution to a UK resident non-dom settlor.
From 6 April 2025, that protected settlement treatment has ceased to apply in the same way.
Where the relevant attribution rules apply and a UK resident settlor retains an interest in a foreign trust, income can now be attributed to the settlor as it arises — with one significant nuance: if the settlor is themselves a qualifying new resident within their own four-year FIG window, the attributed income may itself qualify for FIG relief.
Offshore trusts have not stopped “working” in every sense, but the nature of the protection has changed, and the settlor’s own residence timeline now matters far more directly than it used to.
On the inheritance tax side, the effect is more dramatic still.
Excluded property trusts — broadly, trusts settled with non-UK assets by a non-domiciled individual — lose their excluded status once the settlor becomes a Long-Term Resident, regardless of whether the settlor is currently a beneficiary and, in some circumstances, even if the settlor is no longer UK resident at all.
A trust settled by someone who was deemed domiciled under the old rules could therefore become a relevant property trust from 6 April 2025, bringing it within the normal IHT trust charging regime, including the ten-yearly charge.
The reform did not stand still after 6 April 2025. Following technical fixes confirmed in July 2025 (largely retrospective to 6 April 2025), the Autumn Budget delivered on 26 November 2025 introduced further, material refinements:
The direction of travel is consistent: the UK government is closing gaps in the offshore trust rules while making narrow, targeted concessions to keep the largest pre-existing structures and the highest-value new arrivals from leaving altogether.
None of this changes the core four-year FIG mechanics or the 10-out-of-20 IHT test, but it materially affects anyone relying on transitional protections built into the original 2024 announcement.
“Non-dom is abolished, so FIG replaces it automatically for everyone.” No — FIG is a new-arrival relief tied to the ten-year prior non-residence test. Long-standing non-doms who do not meet that test move straight to worldwide taxation.
“Once I qualify, I should claim FIG on all my foreign income.” Not necessarily — sources that have already suffered significant foreign tax may be better left on ordinary UK taxation with credit relief, and any claim costs the personal allowance and CGT annual exempt amount for the whole year.
“The four-year window is 48 months from my arrival date.” No — it runs by UK tax year, not by month count from arrival, and the “clock” can effectively start earlier than the arrival date suggests once the Statutory Residence Test is applied properly.
“If I’m outside the four-year FIG window, I’m also outside the IHT net.” Not necessarily — the FIG window and Long-Term Resident status run on entirely separate clocks with different qualifying periods and different tail periods after departure.
“My RSUs will be tax-free under FIG because I qualify as a new resident.” No — the vesting gain is employment income, not “foreign income and gains,” and sits outside FIG’s scope entirely. Relief for the non-UK portion of the award instead falls under Overseas Workday Relief, a separate relief with its own conditions and cap.
Pre-arrival planning now carries materially more weight than it did under the old remittance-focused regime, precisely because the arrival date fixes both the start of the four-year window and a key reference point for the ten-year IHT clock. A structured review before relocation should cover:
The FIG regime is simpler in its mechanics than the old remittance basis — there is no more tracing mixed funds or agonising over whether a purchase counted as a remittance.
But it is sharper in its timing, and it sits alongside a second, much longer inheritance tax clock that most new arrivals do not think about until it is too late.
The right way to approach either question is the same: start from the residence tests, establish which year the individual is in, identify the sources involved, and only then work out whether a claim is actually beneficial — never treat “non-dom is over, FIG is in” as a substitute for that analysis.
The UK is far from the only country competing for internationally mobile talent with a time-limited new-arrival tax regime. If FIG doesn’t fit a particular client’s circumstances, or a comparison is useful:
The UK FIG regime explained simply: it is a four-year exemption from UK tax on foreign income and gains for individuals who become UK resident after at least ten consecutive tax years of non-UK residence. It replaced the old domicile-based remittance basis from 6 April 2025 and, unlike that regime, does not tax the money the moment it is brought into the UK.
The 4 year FIG regime UK rule allows a qualifying new resident to have eligible foreign income and gains relieved from UK tax for up to four UK tax years from the point they become eligible, provided a claim is made each year on a source-by-source basis. After the fourth qualifying tax year, worldwide income and gains become taxable in the UK in the normal way.
Under the old remittance basis, foreign income and gains were only taxed if brought into the UK. Under the UK tax FIG regime, qualifying foreign income and gains are relieved from UK tax regardless of whether they are remitted, but only for the first four UK resident tax years, and only if a source-by-source claim is made each year.
HMRC’s formal name is the Residence-based Foreign Income and Gains regime. It is almost universally shortened by practitioners, taxpayers and HMRC’s own guidance to simply the “FIG regime.”
As a general rule, yes — a UK tax resident is taxable on worldwide income and gains as they arise. What changes the answer is whether a relief applies: ordinary foreign tax credit relief, remittance basis transitional protection, or full relief under the FIG regime for a qualifying new resident within their four-year window.
Generally no. The gain on vesting is treated as employment income, apportioned between UK and non-UK duties, and employment income falls outside the FIG regime’s scope entirely — it is instead addressed, where relevant, by Overseas Workday Relief.
A later capital gain between vesting and sale can fall within FIG only to the extent it is genuinely foreign-sourced, and the same UK/non-UK apportionment can limit how much of that gain qualifies.
The UK mechanics are the same, but US citizens and green card holders — or citizens of any country that taxes its people on worldwide income based on nationality — remain taxable on worldwide income regardless of UK tax residence.
Relieving income from UK tax under FIG removes the UK tax that would otherwise support a foreign tax credit back home on the same income, so a UK saving can be partly or wholly offset by higher tax elsewhere.
The claim should be modelled on a combined basis, not on the UK saving alone.
Before 6 April 2025, a “non-dom” was a UK resident individual whose domicile — broadly, their permanent home in law — was outside the UK.
Non-dom status allowed a claim to the remittance basis, taxing only UK income and gains plus any foreign income and gains actually brought into the UK.
Domicile no longer determines UK tax treatment; it has been replaced by the residence-based tests behind the FIG regime and the Long-Term Resident test for inheritance tax.
From 6 April 2025, the remittance basis and the concept of domicile as a connecting factor for tax purposes were replaced by a residence-based system: a four-year Foreign Income and Gains (FIG) regime for qualifying new residents, and a Long-Term Resident test based on UK residence in 10 of the previous 20 tax years for inheritance tax.
An individual qualifies as a “qualifying new resident” if they are UK tax resident under the Statutory Residence Test, were non-UK resident for at least the previous ten consecutive tax years, and are within their first four UK resident tax years since that period of non-residence ended.
Up to four UK tax years, running from the first year of eligibility rather than 48 months from the physical date of arrival. Time spent outside the UK during that period is not added back to extend the window later.
Yes — the claim is made source by source rather than as a blanket election, and different family members can make different choices.
However, within a single source (for example, a category of investment or property income) it is generally an all-or-nothing designation, not asset by asset.
Yes. Making a FIG claim for a tax year removes entitlement to the UK personal allowance and the capital gains tax annual exempt amount for that entire tax year, not just for the designated income — an all-or-nothing trade-off worth modelling before claiming.
No. If qualifying foreign income or gains are relieved under a FIG claim, there is no UK tax charge left to credit foreign tax against on that source — the foreign tax already paid on that income cannot also be recovered via foreign tax credit relief.
The “protected settlement” treatment that shielded qualifying foreign trust income from attribution to a non-dom settlor generally ceased from 6 April 2025.
Attribution rules can now bring trust income into charge for the settlor as it arises, although a settlor who is themselves within their own four-year FIG window may be able to claim relief on the attributed income.
Separately, excluded property trusts can lose their IHT-excluded status once the settlor becomes a Long-Term Resident.
A transitional relief running for three tax years from 6 April 2025 to 2027/28, allowing individuals to designate historic foreign income and gains that arose while they were remittance basis users and bring them into the UK at a reduced flat rate — 12% for 2025/26 and 2026/27, and 15% for 2027/28 — instead of full marginal rates or the old remittance basis charge.
No, and conflating them is one of the most common and costly mistakes. The FIG window runs for four UK tax years for income tax and capital gains tax purposes.
Inheritance tax instead depends on Long-Term Resident status, based broadly on 10 years of UK residence out of the previous 20, with a tail of 3 to 10 years continuing to apply after someone leaves the UK.
The core four-year FIG mechanics and the 10-out-of-20 Long-Term Resident test for IHT were not rewritten, but the Autumn Budget delivered on 26 November 2025 tightened several of the transitional offshore trust protections, extended certain temporary non-resident anti-avoidance rules, introduced a £5 million cap on IHT trust charges for some pre-existing excluded property trusts, and signalled a future consultation on an enhanced offer for high-talent new arrivals.
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