Remittance basis changes
Source: gov.uk (2025-05-16)

Find out about changes to the remittance basis rules from 6 April 2017 to 5 April 2025.

On 6 April 2025 the foreign income and gains regime replaced the remittance basis. If you make a claim for relief under the regime, you’ll not pay tax on your eligible foreign income and gains.

This guidance has not been updated to include this change. You can check if you can claim the foreign income and gains regime (https://www.gov.uk/guidance/check-if-you-can-claim-the-4-year-foreign-income-and-gains-regime).

Before 6 April 2017 you could claim the remittance basis if:
- you were UK resident
- your domicile of origin was overseas and you had not acquired a UK domicile of choice
- you were born with a UK domicile of origin but had acquired a domicile of choice (or dependency) overseas
Changes from 6 April 2017 to 5 April 2025

From 6 April 2017 to 5 April 2025, you were taxed on the arising basis on your worldwide income and gains if you were:
- born in the UK and have a UK domicile of origin
- resident in the UK for at least 15 of the 20 tax years immediately before the relevant tax year
Example

Jamal, who was born in the UK and had a UK domicile of origin, moved to New Zealand aged 20, staying there for many years and acquiring a domicile of choice there.

He then came back to the UK to work on a 2 year secondment for his employer in New Zealand, becoming resident here. He intends to return home to New Zealand after his secondment.

If he had returned to the UK before 6 April 2017 Jamal would be treated as non UK domiciled and would be able to use the remittance basis.

If Jamal returns to the UK after 6 April 2017 he will be treated as UK domiciled from the date he returns to the UK. He will be unable to use the remittance basis and will be taxed on the arising basis on his worldwide income and gains.

The remittance basis charge

From 6 April 2017 to 5 April 2025 there were 2 levels of remittance basis charge:
- £30,000 for non-domiciled individuals who were resident in the UK for at least 7 of the previous 9 tax years immediately before the relevant tax year
- £60,000 for non-domiciled individuals who were resident in the UK for at least 12 of the previous 14 tax years immediately before the relevant tax year
The £90,000 charge no longer applied from 6 April 2017, because of the deemed domicile (https://www.gov.uk/guidance/deemed-domicile-rules) changes brought in from that date.

The £90,000 charge applied for the tax years 2015 to 2016 and 2016 to 2017 if you were UK resident in at least 17 of the preceding 20 UK tax years for either year.

Example

Blanche, a non UK domiciled individual, had been resident in the UK since tax year 1999 to 2000 and had always claimed the remittance basis.

From 6 April 2008 she paid the £30,000 remittance basis charge. This changed to £50,000 from 6 April 2012 to 5 April 2015 (when the higher charge was introduced).

From 6 April 2015 Blanche paid £60,000 remittance basis charge. Then in 2016 to 2017 tax year she paid the £90,000 remittance basis charge. Blanche was treated as deemed domiciled (https://www.gov.uk/guidance/deemed-domicile-rules) from 6 April 2017 (she she had been in the UK for more than 15 of the last 20 tax years) as she met condition B. Read section condition B.

Remittances of foreign income or gains

If you used the remittance basis before 6 April 2017 but after that date you’re deemed domiciled (https://www.gov.uk/guidance/deemed-domicile-rules) for UK tax purposes you must continue to tell HMRC when you remit any foreign income or gains to the UK that arose in a year when you claimed the remittance basis.

Any remittances made in a year when you’re deemed domicile in the UK, from funds that arose in an earlier year when you claimed the remittance basis are still taxable in the year they’re remitted to the UK.

This treatment will continue to apply for all previous remittance basis users after 6 April 2025.

Example

Nikki, due to the number of years she lived in the UK, is deemed domiciled (https://www.gov.uk/guidance/deemed-domicile-rules) from 6 April 2017 under condition B (read section condition B). Previously to this she claimed the remittance basis for a several years.

Nikki is offered the chance to buy land adjoining her UK country home and decides to take advantage of this limited offer. She remits the proceeds of a foreign gain which arose in tax year 2014 to 2015, a year for which she claimed the remittance basis.

She will have to declare this gain on her Self-Assessment tax return for the year in which she remits it to the UK.

Less than £2,000 unremitted foreign income or gains

The new deemed domicile legislation at section 835BA (chapter 2 of part 14 of ITA 2007) does not apply if you’ve used the remittance basis under the provisions of section 809D ITA 2007.

However, you must make sure that unremitted foreign income and gains are under £2,000 for the relevant tax year before deciding if you’re not deemed domicile in the UK for Income Tax and Capital Gains Tax.

Example

Juan had used the remittance basis under section 809D for serval years. From 6 April 2017 he had been in the UK for more than 15 of the last 20 tax years and so becomes deemed domiciled (https://www.gov.uk/guidance/deemed-domicile-rules) in the UK, having met condition B (read section condition B).

However, for tax year 2017 to 2018, as Juan met the conditions for section 809D he continued to use the remittance basis for as long as he meets those conditions.

On 15 September 2019 Juan sold his Caribbean holiday home, placing the proceeds in one of his foreign bank accounts.

When completing his 2019 to 2020 UK tax return Juan was not be able to use the remittance basis under section 809D because his unremitted foreign income and gains were more than £1,999.

Juan was taxed on the arising basis for the year and, even though he did not remit any of the sale proceeds, he needed to declare the foreign gain on his Self-Assessment return.

Until his unremitted foreign income and gains reduced to less than £2,000 in a specific tax year Juan was not able to use the remittance basis. He was treated as deemed domiciled and taxed on his worldwide income and chargeable gains.

Allowances

If you become deemed domiciled and subject to UK tax on your foreign income or gains you may be able to claim the dividend and personal savings allowances.