Asian Private Banker quotes Dominic Lawrance and Julia Cox on anticipated tax changes in the UK

Following the summer’s election of a Labour government, wealthy individuals with UK exposure will likely face more stringent treatment when it comes to taxation. Prime Minister Sir Keir Starmer teased forthcoming changes in a speech in August:

“There’s a budget coming in October, and it’s going to be painful. Those with the broadest shoulders should bear the heavier burden.”

Among such tweaks is the phasing out of non-domicile status which provides favourable tax treatment on worldwide income for those who claim official domicile outside of the UK.

Private Client Partners, Dominic Lawrance and Julia Cox, provide reactionary commentary for Asian Private Banker.

Dominic says:

Since the Labour Party announced plans to abolish the non-dom regime, there has been
a noticeable increase in relocations among wealthy individuals. We are seeing them
relocating to Italy, Switzerland, or Dubai, in numbers that are unusually high for a typical year.

The government should create a replacement tax regime which will ensure that we continue to have these people in our midst and can benefit from everything they have to offer in terms of capital, talent, entrepreneurial spirit and philanthropy, whilst securing a significant flow of tax revenue from them. That is within our grasp if we get these reforms right. If we don’t, the UK will be poorer for it.

On the potential hike to capital gains tax, Julia adds:

Some people are actually talking about going non-resident to realise their gains. That is quite dramatic, not least because you have to go non-resident for effectively six years.

Others are trying to find complex ways to pay taxes on the gains at current rates while retaining the asset.

We have got clients who are thinking of selling shares, quoted or private, to their personal company or trust.”

Read the full piece in Asian Private Banker here (subscription required).