Three months have passed since the reform took effect, making this a good time to take a clear, detailed look at how the new rules actually work — and what their pros and cons are. This is especially relevant for those already living in the UK, as well as those considering a move under visas such as Global Talent or Innovator Founder.

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What Changed on 6 April 2025

Why the Non-Dom Regime Was Attractive — and Why It Was Abolished

The former Non-Dom regime allowed foreigners living in the UK to pay tax only on the income they brought into the country. Any foreign income or capital gains that remained outside the UK were not taxed. This made London especially appealing to wealthy investors, entrepreneurs, and high-level professionals earning money abroad.

However, the system faced growing political and public criticism. It was seen as giving unfair advantages to affluent foreigners, while ordinary UK taxpayers were taxed on their worldwide income. As a result, the government chose to abolish the concept of “domicile” as a factor in tax residency altogether.
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The New FIG Regime: How It Works

As of April 2025, the UK has implemented a new tax regime known as FIG (Foreign Income and Gains), which replaces the Non-Dom system. It allows new tax residents to temporarily avoid UK tax on foreign income and capital gains — even if that money is brought into the UK.

To qualify for FIG, two key conditions must be met:

• ‍A 10-Year Break in UK Tax Residency
  At the point when you first become a UK tax resident, you must not have been a UK tax resident for the previous 10 full consecutive tax years. Even a single year of tax residency within that period makes you ineligible for FIG.
• ‍No More Than 4 Years of UK Tax Residency
  The relief is granted for up to four tax years in which you are a UK tax resident. These years don’t have to be consecutive — you can skip years or choose not to apply FIG — but the four-year clock does not pause or reset. Once the window opens, it runs continuously.

Any income or capital gains arising in the UK are, of course, fully taxable.

This relief is granted only once in a lifetime. After the four-year period ends, all worldwide income and gains become subject to UK tax at standard rates.

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Advantages of the New FIG Regime

Despite criticism of the reform, the new FIG regime has its strong points — especially for those who are only planning to move to the UK.

The main beneficiaries are foreigners relocating to the UK after living abroad for at least 10 consecutive years. They are eligible to avoid paying tax on their foreign income and capital gains for the first four tax years of UK tax residency.

During this preferential period:

• Foreign income and capital gains are not subject to UK tax;
• There is no requirement to track remittances, unlike under the old Non-Dom system — the process is simpler and more transparent;
• You can freely transfer money into the UK without triggering additional tax charges.

Disadvantages and Risks of FIG

Who loses out:

• Those who were already living in the UK under the Non-Dom regime for fewer than 15 years and had no intention of becoming fully taxable residents;
• Those who hoped to maintain tax protection for foreign trusts — as of 6 April 2025, such structures have lost their tax shield unless their beneficiaries meet the FIG eligibility criteria.

It's also important to note that FIG participants are not entitled to standard UK tax reliefs (such as the personal allowance and the annual exempt amount for capital gains).
This means FIG only leads to significant savings if your foreign income is high and consistent.

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Important Definitions

The UK tax year runs from 6 April to 5 April of the following year (for example, 2025/26).

UK tax residency is determined using the Statutory Residence Test (SRT). In simplified terms:

1. If a person spends 183 days or more in the UK in a tax year, they are definitely considered a tax resident.

2. If they spend fewer days, connections to the UK are taken into account:

• Does their family live in the UK?
• Do they have accommodation in the UK?
• Do they work in the UK?
• Have they spent more than 90 days in the UK over the past two tax years?
• Have they spent more time in the UK than in any other country?

Each of these ties reduces the number of days required to be considered a tax resident:

• 1 tie: ≥ 183 days
• 2 ties: ≥ 120 days
• 3 ties: ≥ 90 days
• 4 ties: ≥ 45 days

How the Changes Affect Global Talent and Innovator Founder Visa Holders

Many Global Talent and Innovator Founder visa holders now find themselves in a grey area: some have just recently moved, while others have already spent several years living in the UK and previously benefited from the Non-Dom regime.
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For new residents — FIG can be advantageous

If you moved to the UK in 2025 or later and had not been a UK tax resident during the previous 10 consecutive tax years, you may be eligible for the FIG regime. This gives you the opportunity to fully exempt your foreign income and gains from UK tax for four years — including transfers of these funds into the UK.

For startup founders who have received funding or retained assets abroad, this can be a key reason to relocate now: you can invest in a UK business without being burdened by taxes on foreign income.
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If you’re already living in the UK — FIG might still apply

Many Global Talent visa holders moved to the UK before this tax change, in 2022–2024. In such cases, they already have some tax residency history in the UK, but typically less than four years. This means they may still use FIG for the remaining period.

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Example

Let’s take the case of someone who moved to the UK in September 2022.

1. Before relocating, they had not studied or worked in the UK and had only visited for short tourist trips. Therefore, they had never previously been a UK tax resident.

2. They spent more than 183 days in the UK between 6 April 2022 and 5 April 2023, making 2022/23 their first tax year of UK tax residency and starting their 4-year FIG window.

3. 2023/24 became their second year. In 2024/25, they stayed in the UK for only one month and ceased to be a UK tax resident, but retained the right to use the remaining FIG period. In 2025/26, they returned to UK tax residency.

4. So now (in 2025/26) is the last year they can use the FIG regime and bring in all foreign income — including capital gains from selling shares or property — to the UK tax-free until 5 April 2026. After that, they permanently lose FIG eligibility.
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What You Can Do Now

• Check your tax history and actual residency status for each year. HMRC may request evidence of non-residency for the past 10 years. It’s better to collect supporting documents in advance: tax residency certificates, rental agreements, employment and study records, etc.
  
  
• If you qualify for FIG, plan the inflow of foreign income during the benefit period. With FIG, you can bring money into the UK freely — no tax will apply. It’s a chance to invest in property, launch a business, or cover personal expenses without losing money to tax.
  
  
• If you don’t qualify, consider restructuring your assets (e.g., establishing tax residency elsewhere, deferring gains) and working with UK tax residents (a partner company, family office, etc.).

When Is the Best Time to Move

• If you qualify for FIG and plan to bring in large sums (e.g., from selling a company, dividends, or capital gains), it’s best not to delay. The earlier you relocate, the longer you can benefit from the 4-year window.
• If you previously lived in the UK but are unsure about your tax status, it may be worth waiting a bit to exit the 10-year lookback period.
• If FIG doesn’t apply to you — that’s okay, but you should prepare a solid tax structure in advance that works under the standard UK tax model.