International Adviser quotes Dominic Lawrance on speculation that the UK is considering softening IHT rules on non-doms’ global assets

Various media outlets have reported that Chancellor Rachel Reeves is considering reversing or adjusting the new inheritance tax rules on non-doms’ global assets, introduced in April 2025, amid mounting pressure from the City and a growing exodus of wealthy individuals from the UK.

Dominic Lawrance, Private Client Partner, provides comment on the speculation:

Obviously this is all unclear speculation and the reported rumours contradict each other – some indicating that the Government is considering a U-turn, others indicating that the Government is strongly aligned with its current position on “non-doms”, and would regard a U-turn as politically difficult.

"There is no doubt that the Government’s actions in this area have been economically damaging and that this was a  policy made with limited consultation. It was arguably unwise to proceed with the reforms when there was such strength of informed opinion among professional advisors that the reforms would provoke an exodus. If the Chancellor is surprised by the effect of the policy, she shouldn’t be, as advisors were ringing alarm bells about the likely socio-economic impact from day one.

"If the Government can bring itself to soften the IHT rules in relation to internationally mobile individuals, that would clearly be a step in the right direction, but it may be too little, too late. So many of the horses have already bolted.

"Moreover, although IHT exposure is perhaps the most significant concern about the current UK tax regime for internationally mobile investors and entrepreneurs, it is not the only aspect of the regime which is perceived as less competitive compared to the tax regimes offered by other countries. If the Government is serious about attracting these individuals to the UK, it needs a more comprehensive, properly considered, special tax regime which covers income tax and CGT as well as IHT.

Read the full piece in International Adviser here.