From April 2017, individuals who have been UK resident for 15 of the previous 20 tax years are treated as domiciled in the UK for income tax, capital gains tax and inheritance tax purposes. This is known as "deemed domicile".

What changes

A deemed domiciliary can no longer use the remittance basis to shelter foreign income and gains from UK tax. All worldwide income and gains are taxable in the UK as they arise. For inheritance tax purposes, worldwide assets are within scope — not just UK situs assets.

Planning opportunities

The April 2017 changes brought transitional provisions that allowed certain planning to be undertaken before they took full effect. Some opportunities remain. Offshore trusts established before an individual became deemed domiciled can, in some circumstances, shelter foreign income and gains from UK tax — provided the trust has not become "tainted" by contributions made after the settlor became deemed domiciled.

If you are approaching the 15-year threshold or have recently become a deemed domiciliary, please take advice on your position without delay.