United Kingdom Residence For Individuals

Many individuals, for various reasons, wish to become resident in a new jurisdiction. They may wish to leave their former country of residence for a period before returning and such a period of absence may provide significant tax planning opportunities to shelter assets on a long term basis.

The United Kingdom is a jurisdiction where residence may be obtained fairly easily, particularly for European Union and Swiss citizens. The United Kingdom and London, in particular, is often thought to be an attractive place to live with its moderate climate, excellent communications and services and sophisticated lifestyle.

The United Kingdom tax liability of individuals wishing to obtain residence for a relatively short period may be comparatively low. Such persons are not likely to be domiciled in the United Kingdom. During the first seven years or parts thereof, provided that they remain non-domiciled, they should only be taxed in the United Kingdom on income and capital gains remitted to or arising in the United Kingdom.

After that time, if they elect to pay an additional amount per annum, they may continue to be taxed on the same basis. If they do not then it is likely that they will be taxed on a worldwide income and gains on an arising basis.

However, if they remain non-domiciled then inheritance tax should only be payable on non-UK situs assets for the first 17 years of residence or part thereof.