Briefing note


Anti-gains washing provisions withdrawn but HMRC are thinking of other solutions to the problem which they perceive to exist.

Deemed UK domicile applies from 6th April 2017.

Transitional rules for mixed funds and grandfathering of existing excluded property trusts.


Update on the UK’s non-domiciled status

Who should read this?

Anyone who was UK resident but non-UK domiciled before 6th April 2017, non-UK resident trustees with UK resident settlors or beneficiaries, and their advisers.

Why should you read this?

Contrary to many rumours, but as we predicted and advised by us, the new Finance (No.2) Bill 2017 will contain all the new rules on deemed UK domicile and IHT on residential property that were in the Finance Bill 2017 and were dropped from the Parliamentary process because of the General Election.

The sole exception is the anti-trust gains washing rules as HMRC found these unworkable and are therefore considering other solutions to what they perceive to be the problem.

So what remains?

If 2016/17 is your 16th (or more) tax year resident in the UK in the last 20 tax years then you are deemed to be UK domiciled.

If someone in this position has died since 6th April then they might have thought that they had died non-UK domiciled, but in the absence of any amendment, they will have died UK domiciled.

We have suggested to HMRC that they exclude such people.

If you are now deemed UK domiciled you are advised to have your non-UK assets valued as at 6th April 2017.

This will be useful on any future disposal.


If you are deemed UK domiciled then you can protect the tax treatment of your existing trust but you must not add any more value to it otherwise the protection is lost.

Immediate actions to take

If you have not already done so you should:

• Review your personal assets and status
• Check your will or testamentary trusts
• Review any non-UK resident trusts and whether income or gains need to be washed out
• Value your non-UK personal assets.

We attach our earlier releases on IHT and UK residential property and deemed UK domicile.

Glossary and small print

This note assumes that the reader has a knowledge of UK taxation of HNWIs and RNDs, and is either a client of this firm or an adviser to such a client, and it is of course no substitute for advice based on your personal facts and circumstances.

No liability is accepted for reliance by any person upon any statement made in this paper.

Section 61(2) Law of Property Act 1925 applies to this paper.

Leave Comments

Nunc velit metus, volutpat elementum euismod eget, cursus nec nunc.