The manager of among London’s leading estate firm chains today advised concerning the effect of eliminating non-dom condition on the leading end of the funding’s residential property market.
Dominic Agace, president of of Winkworth, was talking as it was reported that Chancellor Rachel Reeves is having doubts concerning axing non-dom condition – which permits rich people based in Britain to safeguard their international incomes and possessions from UK tax obligation – due to the fact that it can cause an exodus to various other nations.
Officials at the Treasury and the Office for Budget Responsibility are claimed to be distressed that the step can in fact decrease the tax obligation take by as high as ₤ 1 billion.
Agace claimed: “We are experiencing a lot of uncertainty at the top end of the market with high net worth individuals looking at their options. Uncertainty about the future trajectory of taxation, alongside stated policies is creating a growing negative UK sentiment.
“Non dom status removal was one trigger but this has only been exacerbated by the language coming from the Labour Government in advance of the October Budget. The feeling is that there will be several measures that will target non-doms and that they are not wanted here.
“With the level of wealth of these individuals, VAT on school fees in itself is not an issue but together with a perception of high knife crime rates in London, there is a growing movement among these high net worth people of where to move to. In the short term, this is halting investment and decisions to locate in the UK, as well as those living here bringing their houses to the market.”
Josh Grinling, of Winkworth’s Kensington workplace, claimed: “Some non-doms are moving to Monaco and Lisbon. Others are just going home back to Paris, Rome, and Madrid. Almost every other country now has a more welcoming tax package than is being offered in UK. Most countries see the benefit of rich people living there and the trickle down effect it creates for the economy. This new system is hollowing out central London.”
Another Winkworth prime main London representative claims among his customers is transferring to Switzerland as an outcome of all the unpredictability.
Stephen Kenney, a companion in PKF Littlejohn’s Private Client tax obligation group, claimed: “The news that the government is reconsidering its stance on the non-dom regime will be welcomed by many globally-mobile high net worth individuals – but it may now be too late, as significant damage has already been done.
“The government has been warned for some time that the abolition of non-dom status will not raise the amounts it wanted, so it’s not clear why it’s now suddenly looking to change tack.
“The number of non-doms in the UK has already been decreasing since the last round of changes in 2017, and the rate of departure has accelerated since the government’s original announcement.
“The scale of the proposed changes has meant that significant numbers of non-doms have decided that remaining in the UK is unfeasible, with many already relocating in anticipation of the changes.”“To attract non-doms to live and invest into the UK, the government needs to provide certainty over how they’ll be taxed. Announcing sweeping reforms to the rules without consultation and then, at the eleventh hour, rowing back on the changes doesn’t encourage confidence.
“Reform of the non-dom rules should be done in consultation with the industry to ensure the new regime is internationally competitive, raises money for the Treasury and rebuilds confidence with ultra-high net worth individuals. This will show that the UK is open for business.”
