{"id":45801,"date":"2019-08-09T07:40:00","date_gmt":"2019-08-09T06:40:00","guid":{"rendered":"https:\/\/www.taxresearch.org.uk\/Blog\/?p=45801"},"modified":"2019-08-09T07:40:00","modified_gmt":"2019-08-09T06:40:00","slug":"non-doms-may-not-be-going-they-might-just-be-paying-tax","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2019\/08\/09\/non-doms-may-not-be-going-they-might-just-be-paying-tax\/","title":{"rendered":"Non-doms may not be going. They might just be paying tax"},"content":{"rendered":"

The Guardian reported<\/a> yesterday that:<\/p>\n

The number of super-rich people who live in the UK but pay no tax on their offshore income has fallen to a record low, according to figures published by HM Revenue & Customs<\/a> (HMRC) on Thursday.<\/p>\n

UK-based people with non-domicile tax status \u2014 so called \u2018\u201cnon-doms\u201d \u2014 in the 2017-18 financial year totalled 78,300, a fall of 13% on the previous year.<\/p>\n

Their status led to a \u00a32bn decline in the taxes they paid to the exchequer. The amount of tax they paid fell from \u00a39.5bn in 2016-17 to \u00a37.5bn last year.<\/p>\n

Tax experts said the drop in non-doms reflects the growing number of wealthy people leaving the UK because of Brexit uncertainty and fears that a Jeremy Corbyn-led government would introduce a \u201cwealth tax\u201d<\/a> to tackle growing inequality.<\/p>\n

Josie Hills, a senior tax manager at the law firm Pinsent Masons, said: \u201cBrexit uncertainty is driving out many of the wealthiest non-doms who are not prepared to hang around to find out the outcome.<\/p><\/blockquote>\n

Let me offer an alternative explanation that I think much more likely than this deeply politically driven hype from the firms servicing this declining market.<\/p>\n

It costs to be a non-dom. The charge can be as much as \u00a360,000 a year. It increases the longer a person claims to be non-domiciled.<\/p>\n

My suggestion is a simple one. The non-doms might not be leaving. Instead I suspect they may just be choosing to pay their taxes in the UK.<\/p>\n

Accounting on a remittance basis is a hassle.<\/p>\n

The cost is growing for many non-doms as time elapses.<\/p>\n

And it is known that HMRC is more willing to challenge non-dom status now.<\/p>\n

The result? It\u2019s just easier to pay your tax and live hassle-free, I suggest.<\/p>\n

That, I think is the reason for the decline in the number of non-doms.<\/p>\n

And that helps explain the growing concentration in tax paid by the very wealthy<\/a>.<\/p>\n

I am not saying the non-dom problem has gone away. But I am saying that knee jerk reactions to news about it may not be appropriate. And HMRC may be making progress here.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Guardian reported yesterday that: The number of super-rich people who live in the UK but pay no tax on their offshore income has fallen
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