Moving to the UK

Do new UK residents pay tax on foreign income?

Answered by Jordan Onraet-Wells, Founder & Chartered Tax Adviser (CTA). Published 17 July 2026. Last reviewed 17 July 2026.

The short answer

Yes, by default. UK residents, including new arrivals, normally pay UK tax on their worldwide income and gains. However, many new arrivals qualify for the 4-year Foreign Income and Gains (FIG) regime, which gives full UK tax relief on qualifying foreign income and gains for the first four tax years of UK residence, provided they were non-UK resident for the 10 tax years immediately beforehand. The relief must be claimed each year on a Self Assessment return; it is not automatic.

The default rule is worldwide taxation: UK residents normally pay UK tax on foreign income and gains as well as UK income.
The 4-year FIG regime replaced the non-dom remittance basis on 6 April 2025 and exempts qualifying foreign income and gains for your first four years of UK residence, with no charge for bringing the money to the UK.
You qualify only if you were non-UK resident for the 10 tax years immediately before becoming UK resident; returning British citizens can qualify because the test is residence-based, not domicile-based.
The claim is made each year on the SA109 pages of your Self Assessment return; it is never applied automatically.
Claiming costs you your £12,570 Personal Allowance and £3,000 Capital Gains Tax annual exempt amount for that year, so a claim can cost more than it saves if your foreign income is small.
UK-source income (UK salary, UK rents, gains on UK property) stays taxable as normal, and foreign employment earnings are relieved separately under Overseas Workday Relief, not the FIG claim.

The default rule: worldwide taxation

Once you become UK tax resident, the default position is that you pay UK tax on your worldwide income and gains, not just your UK earnings. Your residence status is decided by the Statutory Residence Test, and in your arrival year split-year treatment may divide the year into a non-UK part and a UK part, so the year you move needs careful handling.

The big exception: the 4-year FIG regime

From 6 April 2025 the 4-year FIG regime replaced the old non-dom remittance basis. If you were non-UK resident for the 10 consecutive tax years immediately before becoming resident, you can claim full UK tax relief on qualifying foreign income and gains (foreign dividends, interest, rents and gains arising from 6 April 2025) for your first four years of residence, and bring the money into the UK freely with no remittance charge. Because the test is residence-based, not domicile-based, returning British expats qualify too. UK-source income remains taxable throughout, and foreign employment income sits outside the FIG claim: it is relieved separately through Overseas Workday Relief.

The trap: the claim is annual and has a price

The relief is not automatic. You must claim it each year on the SA109 residence pages of your Self Assessment return, and each claim costs you your £12,570 Personal Allowance and £3,000 Capital Gains Tax annual exempt amount for that year. With large foreign income that price is trivial; with modest foreign income the lost allowances can cost more than the relief is worth, and the right answer can change from year to year. Before filing, confirm your 10-year residence history under the Statutory Residence Test and model the numbers both with and without the claim.

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Sources and further reading

This is general information for the 2026/27 UK tax year, not personal tax advice; speak to a Chartered Tax Adviser about your own position.

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