United Kingdom: the FIG regime for new residents, Overseas Workday Relief and corporation tax

On 6 April 2025, the United Kingdom abandoned taxation based on domicile. All residents are now taxed on their worldwide income and gains as they arise (HMRC, RFIG41000). The "non-dom" status and the remittance basis are things of the past: describing them as a current regime is a mistake.

What remains is an arrival regime, the FIG regime, which exempts a new resident's foreign income and gains for at most up to 4 years¹, provided that the person had not been resident for at least from 10 years² in a row beforehand. Salary falls under a separate scheme, Overseas Workday Relief.

For businesses, corporation tax applies a main rate of 25%³ and a reduced rate of 19%⁴ for small profits.

Residence: the Statutory Residence Test

Residence is determined for each tax year (from 6 April to 5 April) under the Statutory Residence Test. A presence of at least from 183 days⁵ automatically makes a person resident. Conversely, a person who was non-resident in the three preceding tax years is automatically non-resident if they spend fewer than less than 46 days⁶ in the United Kingdom; for a former resident, the threshold drops to fewer than less than 16 days⁷ (HMRC, RDR3). Between these limits, the sufficient ties test (family, accommodation, work, past presence) decides.

Tax bands and allowances

For 2026-27, the personal allowance is £12,570⁸. Taxable income is then taxed at 20%⁹ up to £50,270¹⁰, at 40%¹¹ up to £125,140¹² and at 45%¹³ above that (GOV.UK, Income Tax rates). The personal allowance is gradually reduced above an adjusted net income of more than £100,000¹⁴.

Taxpayers resident in Scotland apply a separate scale for income other than savings and dividends; it is not covered here. National Insurance contributions are not quantified in this page.

Dividends and capital gains

Dividends benefit from an annual allowance of £500¹⁵. Beyond that, for 2026-27 they are taxed at 10.75%¹⁶ in the basic rate band, 35.75%¹⁷ in the higher rate band and 39.35%¹⁸ in the additional rate band (GOV.UK, Tax on dividends).

Capital gains are taxed at 18%¹⁹ for the portion falling within the basic rate band and at 24%²⁰ above that (GOV.UK, Capital Gains Tax rates).

The FIG regime: who it is for, what it covers, and what it costs

The "4-year foreign income and gains" regime is reserved for people still in their first years of UK residence after at least from 10 years² of consecutive non-residence. It lasts at most up to 4 years¹ in a row, counted from the start of residence (GOV.UK, check if you can claim the FIG regime). Arriving partway through a period reduces the number of remaining years accordingly.

Income covered, according to HMRC:

• profits from an activity carried on entirely outside the United Kingdom;
• income from a property business abroad;
• dividends from non-resident companies;
• foreign interest, such as that from a bank account outside the United Kingdom;
• capital gains on foreign assets, under the rules of the RFIG manual.

Foreign employment income and specific foreign employment income are excluded: they may fall under Overseas Workday Relief, not the FIG regime. Income from UK sources remains taxed normally.

The claim is annual: it is made in the Self Assessment return of each year, itemising and quantifying the income and gains concerned; a claim for the first year does not cover the following ones, and a claim without figures is invalid (HMRC, RFIG42100).

Its cost is real: in the year of the claim, the person loses the personal allowance, the blind person's allowance, the tax reductions for married couples and civil partners, and the annual CGT allowance, even if the claim covers only part of the foreign income (HMRC, RFIG43000). For a resident with modest foreign income, the claim may cost more than it brings.

Exempt income and gains can be brought into the United Kingdom without tax: unlike the former remittance basis, the regime does not depend on keeping funds abroad.

Overseas Workday Relief: salary for days worked abroad

Overseas Workday Relief exempts the part of salary corresponding to the days worked outside the United Kingdom, for an employee who was non-resident for at least from 10 years²¹ before arrival. New resident status can cover up to up to 4 years²². Since 6 April 2025, the relief is capped at the lower of up to 30%²³ of eligible employment income and up to £300,000²⁴ (HMRC, Overseas Workday Relief).

For income of the period before 6 April 2025 taxed under the remittance basis, the condition of paying it into and keeping it in an account abroad still applies; for other income, the funds can be brought into the country without charge.

The transition: Temporary Repatriation Facility

Former users of the remittance basis can designate their foreign income and gains arising before 6 April 2025 and bring them into the United Kingdom in return for a charge of 12%²⁵ for the 2025-26 and 2026-27 tax years, then 15%²⁶ for 2027-28 (HMRC, RDRM73400). The facility is open for 3 years²⁷, from 2025-26 to 2027-28 (tax policy paper). The last-year rate was not yet applicable as at 1 November 2026.

Inheritance: a long-term residence criterion

Inheritance tax no longer depends on domicile but on long-term residence: a person is exposed on their worldwide assets when they have been resident for at least from 10 years²⁸ during the 20 years²⁹ preceding the tax year in question, according to the government's tax policy paper.

The inheritance tax rate, the exemption threshold (nil-rate band) and the length of time the exposure continues after departure were not found in any official source consulted.

Corporation tax applies to company profits at the main rate of 25%³. A company whose profit does not exceed up to £50,000³⁰ pays the reduced rate (small profits rate) of 19%⁴; above more than £250,000³¹, the main rate applies, and tapered relief operates between the two (GOV.UK, Corporation Tax rates).

A distribution to a partner is taxed in the partner's hands as a dividend, according to the applicable band, after the annual allowance. The FIG regime of a partner who is a new resident does not cover dividends from a UK company: only dividends from non-resident companies are foreign income.

The United Kingdom applies the multinational top-up tax and the domestic top-up tax, which impose a minimum of 15%³² on groups whose consolidated revenue reaches from €750,000,000³³ in at least two of the four preceding accounting periods, for accounting periods beginning on or after 31 December 2023 (HMRC). Standalone companies and groups below this threshold are not subject to them.

Company residence rules (place of incorporation, central management and control), the controlled foreign companies regime, the exemption for foreign permanent establishments and accounting obligations to Companies House were not found in any official source that was read.

Since the United Kingdom left the European Union, a French national no longer has freedom of establishment there: a visa or immigration status is required to live and work there, apart from special cases (resident status obtained before the exit, Irish nationality and the Common Travel Area).

The visa categories (skilled worker, intra-company transfer, global talent, business creation) and their financial conditions were not checked against any official source that was read for this page.

The year of arrival is decisive: it starts the FIG regime period even if no claim is made. It is therefore necessary to decide, from the first return, whether the claim is worth the loss of the allowances, and to quantify foreign income year by year.

The FIG regime requires at least from 10 years² of consecutive non-residence: a person who lived in the United Kingdom during their studies or a previous posting must precisely recount their past years of residence under the Statutory Residence Test, tax year by tax year.

The Statutory Residence Test also includes rules for splitting the year (split year) on arrival or departure, and an anti-avoidance rule for temporary non-residents; they are not detailed here.

For former non-domiciliaries, the transition issue is the treatment of sums accumulated before 6 April 2025: without a designation under the TRF, their remittance remains taxable under the previous rules.

No documented official source on an expatriate's cost of living or property prices was read for this page; the gaps between London and the rest of the country call for a costing based on the Office for National Statistics series before any decision.

1. Recount past years of UK residence before relying on the FIG regime or Overseas Workday Relief.
2. Register for Self Assessment: the FIG claim is made only in the return, each year, with a calculation.
3. Keep a record of days worked outside the United Kingdom for Overseas Workday Relief.
4. For a former non-domiciliary, list foreign income and gains arising before 6 April 2025 and decide whether to designate them under the TRF before the end of 2027-28.
5. For a company, check its position against the profit thresholds and document the place of management.

• The FIG regime is not a renamed remittance basis: it is short, declaratory, and costs the year's allowances.
• Salary is never covered by the FIG regime; only Overseas Workday Relief can reduce its tax, and within a capped limit.
• The income tax rates cited do not apply to Scottish taxpayers.

Does the "non-dom" status still exist?

No. Since 6 April 2025, taxation no longer depends on domicile but on residence. The FIG regime has replaced it for new arrivals, with a maximum duration of up to 4 years¹.

Can I remit my foreign income exempted under the FIG regime?

Yes: income and gains covered by a claim can be brought into the United Kingdom without tax, which distinguishes the regime from the former remittance basis.

Does the FIG regime cover my salary from a foreign employer?

No. Foreign employment income is excluded; the part of the salary linked to days worked outside the United Kingdom may fall under Overseas Workday Relief, capped at the lower of up to 30%²³ of eligible income and up to £300,000²⁴.

What is lost by claiming the FIG regime?

The personal allowance for income tax, other personal allowances and the annual CGT exempt amount, for the whole year of the claim.

Is my small company affected by the minimum tax on large groups?

No, unless it belongs to a group whose consolidated revenue reaches from €750,000,000³³ in at least two of the four preceding accounting periods.