What changed on 6 April 2025
6 April 2025 brought the biggest reset of UK international personal tax rules in a generation. The remittance basis, which had let non-domiciled residents keep foreign income and gains outside UK tax while the money stayed offshore, was abolished, domicile was removed as a connecting factor, and 2024/25 was the last tax year for which a remittance-basis claim could be made. From 2025/26 every UK resident is taxed on the arising basis: worldwide income and gains as they arise, wherever the money sits.
In its place came the 4-year Foreign Income and Gains (FIG) regime. It is built on residence history rather than domicile: anyone who becomes UK resident after at least 10 consecutive tax years of non-UK residence can claim full relief on qualifying foreign income and gains for their first four resident years (GOV.UK). It arrived alongside the Temporary Repatriation Facility for old remittance-basis money and a rewritten Overseas Workday Relief for foreign employment duties. Inheritance Tax moved to a residence-based test on the same date.
FIG regime vs remittance basis: the side-by-side comparison
The two systems answer the same question, how the UK taxes a resident's foreign income and gains, in opposite ways. The table below sets out the decision factors.
| Decision factor | 4-year FIG regime (from 6 April 2025) | Old remittance basis (abolished) |
|---|---|---|
| Who qualifies | Any new UK resident after 10 consecutive non-resident years, including British citizens | Non-UK domiciled residents only |
| How long it lasts | First 4 tax years of UK residence, fixed window | Indefinite, subject to charges after 7 years |
| Bringing money to the UK | Free: relieved income and gains can be remitted with no UK tax | Taxed on remittance at up to 45%, whenever remitted |
| Annual charge | None | £30,000 or £60,000 for longer-term residents |
| Cost of claiming | Lose the £12,570 Personal Allowance and £3,000 CGT exempt amount | Lost the same allowances in most claim years |
| Foreign employment income | Separate Overseas Workday Relief, capped at lower of 30% of pay and £300,000 | Relieved via old OWR with offshore payment conditions |
| Reporting | Full source-by-source disclosure on the return, relief applied on top | Unremitted amounts could stay off the UK return |
| Status in 2026/27 | Live: claim annually on the SA109 | Gone: 2024/25 was the final claim year |
The headline trade is simple: new arrivals gained a cleaner, more generous relief with no remittance trap and no annual charge, in exchange for a strict time limit, full disclosure, and arising-basis taxation for everyone outside the four-year window.
Who the FIG regime helps
The clearest winners are arrivals from 2025/26 onwards with meaningful foreign income or gains. A qualifying new resident can receive foreign dividends, interest, overseas rental profits and foreign capital gains entirely free of UK tax for four years, and, unlike under the old rules, spend that money in the UK immediately, with no domicile test, no remittance charge and no need to keep funds offshore. Someone realising a large foreign gain or drawing substantial overseas income during the window saves tax at rates that would otherwise reach 40% or 45% on income (GOV.UK income tax rates) and 24% on gains.
The relief is not free or automatic. Claiming for a year forfeits your £12,570 Personal Allowance and £3,000 Capital Gains Tax annual exempt amount, so a claim on a small amount of foreign interest can cost more than it saves. The claim is made year by year on the SA109 pages, boxes 28 and 29, with every relieved amount quantified source by source (HS266, GOV.UK). Our SA109 walkthrough covers the mechanics, and our FIG checker will tell you whether your dates qualify.
Returning British expats: the group the old rules shut out
The quietest winners are returning British citizens. Under the old system, a UK-domiciled expat coming home could never use the remittance basis, however long they had been away. Because the FIG regime turns solely on residence history, a British national who was non-resident for the 10 tax years before returning qualifies exactly like a first-time arrival. The catch: all 10 prior years must be genuinely non-resident under the Statutory Residence Test, because one accidental year of UK residence in that window breaks eligibility, so the day-count history needs checking before anything is claimed.
Who lost out when the remittance basis was abolished
The losses fall on three groups. First, and hardest hit, are long-term non-doms already UK resident for more than four years. Their four-year window has passed, so they get nothing from the FIG regime, and since 6 April 2025 they have been taxed on worldwide income and gains as they arise. Under the old rules they could have claimed the remittance basis indefinitely, paying the £30,000 or £60,000 annual charge where it applied; that option no longer exists at any price.
Second are former remittance-basis users holding untaxed pre-6 April 2025 foreign income and gains offshore. The remittance trap did not die with the regime: bringing that old money to the UK is still a taxable remittance, at up to 45% for income and CGT rates of up to 24% for gains. The Temporary Repatriation Facility, covered below, is the time-limited discount on exactly this problem.
Third are people the new regime helps only marginally: arrivals with modest foreign income, for whom surrendering the Personal Allowance makes a FIG claim uneconomic, and anyone who planned a long UK stay expecting to shelter foreign income for decades. For them, the four-year clock is a genuine downgrade.
The Temporary Repatriation Facility: the bridge for old money
The TRF is the transitional deal for former remittance-basis users. For a fixed three-year window covering 2025/26, 2026/27 and 2027/28 (RDRM71000, HMRC), they can designate pre-6 April 2025 foreign income and gains and pay a flat charge of 12% for designations in 2025/26 or 2026/27, rising to 15% for 2027/28 (RDRM73400, HMRC). Once designated and charged, the funds can be brought to the UK at any future date, even after the facility closes, with no further UK tax.
Designation is made on the SA109 pages, boxes 50 to 52 (HS264, GOV.UK), and you do not have to move the money during the window: designate now at 12%, remit whenever you like. The window is unforgiving: after 5 April 2028 the reduced rates vanish and old money reverts to normal remittance taxation. There is no exemption for funds used to pay the charge itself, so paying it from undesignated pre-2025 foreign income is itself a taxable remittance; pay from designated funds or clean capital. Our full Temporary Repatriation Facility guide works through the numbers, including why designating £500,000 in 2026/27 costs £60,000 against £75,000 a year later.
What arrivers and returners should do now
If you are planning a move to the UK, or returned recently, the sensible sequence for 2026/27 looks like this.
- Confirm your 10-year clock: check each of the 10 tax years before your arrival year against the Statutory Residence Test, because a single resident year kills FIG eligibility. Start with our FIG checker.
- Time your arrival deliberately: the four-year window is fixed from your first resident year and a split-year arrival still burns a full year, so landing early in a tax year usually extracts more value.
- Run the arithmetic every year: claim only when the tax saved beats the £12,570 Personal Allowance and £3,000 CGT exempt amount you give up.
- Plan the filing route now: the SA109 cannot go through HMRC's free online service, so you need commercial software, an agent or a paper return.
- Former remittance-basis users: quantify your pre-6 April 2025 offshore pool and model a TRF designation while the 12% rate still applies; 2026/27 is the last 12% year.
- Check your Inheritance Tax position too: long-term UK residence now drives worldwide IHT exposure under the residence-based rules.
The common thread: the FIG regime and the TRF run on fixed clocks that do not pause, so the new system rewards planning before the tax year starts. We handle FIG eligibility reviews, first-year SA109 claims and TRF designations end to end on fixed fees agreed upfront, and our moving to the UK guide covers the wider arrival checklist.
