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uk briefing

Leaving the UK: the 2026 tax guide

Plan a UK exit with verified 2026 rules: the FIG regime, the inheritance tax tail, the Statutory Residence Test and the five-year rule on gains.

9 min read

The UK rewrote its rules for internationally mobile residents in April 2025. Domicile has left the tax code, and residence now decides almost everything: how new arrivals are taxed, how long inheritance tax follows you after you leave, and when your exit actually counts. If you are weighing up a move in 2026, this guide sets out the rules that matter, with primary sources for each figure so you and your adviser can check every step.

Two things to hold onto throughout. First, the UK tax year runs from 6 April to 5 April, and nearly every deadline below keys off that date (GOV.UK, accessed 16 July 2026). Second, several rules depend on your personal residence history, so two people leaving on the same flight can face very different outcomes. Where a rule is person-dependent, we say so — confirm the specifics with your adviser.

The non-dom regime ended on 6 April 2025

The remittance basis for non-UK domiciled residents was abolished with effect from 6 April 2025. In its place, the government introduced a residence-based regime for foreign income and gains, known as the FIG regime (GOV.UK policy summary, accessed 16 July 2026).

The 4-year FIG regime

The FIG regime gives qualifying new arrivals 100% relief on foreign income and gains for their first 4 tax years of UK residence. Eligibility is strict: you must have been non-UK resident for the 10 consecutive tax years before arrival (GOV.UK policy summary, accessed 16 July 2026).

For people thinking about leaving, the 10-year condition is the detail worth writing down. A future return to the UK within 10 years means the FIG regime will be closed to you, so a clean, well-documented exit also protects the option of coming back one day as a qualifying new arrival.

Claiming FIG relief has a price: the claim costs you the income tax personal allowance and the capital gains annual exempt amount for that year, so whether it pays depends on your income mix (GOV.UK policy summary, accessed 16 July 2026).

The Temporary Repatriation Facility

Former remittance-basis users have a limited window to clean up historic offshore funds. The Temporary Repatriation Facility (TRF) lets you designate pre-6 April 2025 foreign income and gains at a flat rate: 12% for designations in 2025/26 and 2026/27, rising to 15% in 2027/28, after which the facility closes (Deloitte TaxScape; Saffery, accessed 16 July 2026). Designated funds can later be brought to the UK with no further income tax or capital gains tax, and designation works without an immediate remittance — you can pay the flat rate now and move the money later (Saffery, accessed 16 July 2026).

If you used the remittance basis in the past and are planning to leave, the TRF belongs on your pre-departure checklist. The 12% window closes on 5 April 2027.

Inheritance tax now follows residence

From 6 April 2025, exposure to UK inheritance tax (IHT) on worldwide assets is decided by a long-term residence test. You are a long-term UK resident if you were UK tax resident for at least 10 of the previous 20 tax years (GOV.UK long-term resident guidance, accessed 16 July 2026). Long-term residents are within UK IHT on their worldwide estate at the standard rate of 40% above the £325,000 nil-rate band (GOV.UK, accessed 16 July 2026).

The part that matters for leavers is the tail. Leaving the UK switches long-term resident status off gradually, and the length of the tail depends on how long you were resident (GOV.UK long-term resident guidance, accessed 16 July 2026):

UK-resident years (of the previous 20)Worldwide IHT exposure after departure
10–13 years3 tax years
14 years4 tax years
15 years5 tax years
16 years6 tax years
17 years7 tax years
18 years8 tax years
19 years9 tax years
20 years10 tax years

A transitional rule helps some long-standing residents: individuals who were non-domiciled and had deemed-domicile status on 30 October 2024 can qualify for a shortened 3-year tail, subject to conditions (GOV.UK long-term resident guidance, accessed 16 July 2026). Whether it applies to you is fact-specific — confirm with your adviser.

During the tail, UK-situs assets remain in scope regardless, and whether tax is actually payable on foreign assets can depend on a double tax treaty between the UK and your new home. The UK has estate tax treaties with only a small number of countries, which makes treaty cover a genuine selection factor when choosing a destination.

The Statutory Residence Test decides when you have left

UK tax residence ends when you stop meeting the Statutory Residence Test (SRT), the framework set out in HMRC’s RDR3 guidance. The SRT weighs your UK day count against ties: available accommodation, family in the UK, UK workdays, more than 90 days in the UK in either of the two prior years, and — for leavers — the country tie (GOV.UK RDR3, accessed 16 July 2026).

The strictest route to certain non-residence is the first automatic overseas test: fewer than 16 days in the UK in a tax year, for someone who was UK resident in any of the three prior years (GOV.UK RDR3, accessed 16 July 2026). Most leavers keep more ties than that, which is why day-count and tie planning deserves a spreadsheet before the move is booked.

Split-year treatment

Without relief, residence applies to whole tax years. Split-year treatment divides the departure year into a UK part and an overseas part, so income and gains arising after you leave fall outside UK tax for most purposes. Three cases cover leavers: starting full-time work overseas (Case 1), accompanying a partner who does (Case 2), and ceasing to have any home in the UK (Case 3). Each case has detailed conditions, and all of them require you to be non-UK resident for the following full tax year (GOV.UK RDR3, accessed 16 July 2026). Split-year treatment is applied on the facts — documenting those facts as you go is the cheapest insurance available.

The five-year rule on gains and dividends

Temporary non-residence rules are designed to catch short tax-motivated absences. You are within them if you were UK resident in at least 4 of the 7 tax years before departure and your period of non-residence lasts 5 years or less (GOV.UK HS278, accessed 16 July 2026).

The consequence is significant: gains realised while you were away become chargeable to UK capital gains tax in the tax year you return (GOV.UK HS278, accessed 16 July 2026). The same framework catches certain income, including dividends from close companies — broadly, small owner-managed companies. For individuals returning on or after 6 April 2026 the rules tighten further: the previous carve-out for dividends paid from profits earned after departure is removed, so all close-company distributions received during a temporary absence come into charge on return (GOV.UK policy paper, accessed 16 July 2026).

The practical reading for founders and shareholders: a plan that involves realising a gain or extracting company profits while abroad only holds if the absence genuinely exceeds 5 years. Build the return-date discipline in from day one.

Timing the move around the tax year

Because the UK tax year starts on 6 April, the calendar does real work in an exit plan:

  • A departure early in the tax year gives the split-year claim the most room and keeps the UK part of the year short.
  • Crystallising income before or after 5 April — bonuses, option exercises, dividend timing — can move an item between a UK-resident year and a non-resident one. This is the highest-leverage adviser conversation before anything is booked.
  • The IHT tail clock runs in tax years from departure, so a clean exit at the start of a tax year starts the tail sooner.
  • TRF designations are made by tax year; the 12% rate covers 2025/26 and 2026/27 only (Deloitte TaxScape, accessed 16 July 2026).

Who benefits from moving quickly, and who can take time

Timing matters most for:

  • Former remittance-basis users with large unremitted funds — the 12% TRF rate ends on 5 April 2027, and 15% ends on 5 April 2028 (Deloitte TaxScape, accessed 16 July 2026).
  • People approaching year 10 of UK residence — crossing 10 of 20 years switches on worldwide IHT exposure and, on a later exit, a tail of at least 3 years.
  • Long-term residents already at 15 or more years — each further resident year adds a year to the IHT tail, up to 10.
  • Anyone with a large planned disposal — the 5-year non-residence clock only starts once you have actually left.

Time is on the side of:

  • People well below the 10-of-20 threshold with mainly UK-source income, for whom an exit changes less than they may expect.
  • Anyone whose destination shortlist is still open — visa routes, treaty cover and family logistics usually deserve a full tax year of planning.
  • Cases that hinge on person-dependent rules (the deemed-domicile transitional tail, trusts settled before 6 April 2025, pension treatment). These reward careful sequencing with an adviser.

Popular destinations each carry their own trade-offs — the UAE, Italy’s flat-tax regime, Switzerland’s lump-sum cantons, Portugal’s IFICI, Cyprus and Malta all appear frequently on UK leavers’ shortlists. The right answer depends on your income mix, family situation and treaty cover.

If you want the numbers for your own situation, run the free instant check — it takes two minutes and shows which of these rules bind in your case. To see what a full advisor-ready brief looks like, browse the sample report.

Sources

This guide is orientation, and none of it is personal tax advice. Rules change and several tests above depend on your individual history — verify every figure with a qualified adviser before acting.

FAQ

Do I still owe UK inheritance tax after I leave? Possibly, yes. If you were UK resident for 10 or more of the previous 20 tax years, your worldwide estate stays within UK IHT for 3 to 10 tax years after departure, depending on how long you were resident (GOV.UK, accessed 16 July 2026). UK-situs assets remain in scope indefinitely. Treaty relief depends on your destination — confirm with your adviser.

Can I sell my company shares tax-free once I have left? Only if the absence is long enough. If you were UK resident in 4 of the 7 years before leaving and you return within 5 years, gains realised abroad are taxed in the year of return (GOV.UK HS278, accessed 16 July 2026). Local tax in your new country may also apply.

When does my UK tax residence actually end? When you stop meeting the Statutory Residence Test. A split-year claim can divide the departure year into a UK part and an overseas part, provided you meet one of the leaver cases and stay non-resident for the following full tax year (GOV.UK RDR3, accessed 16 July 2026).

Could I return to the UK later under the FIG regime? Yes, if you first complete 10 consecutive tax years of non-UK residence. The regime then gives up to 4 years of relief on foreign income and gains (GOV.UK policy summary, accessed 16 July 2026). Rules may change before then — treat this as an option, and plan the exit on its own merits.

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Compare the jurisdictions.

United KingdomUnited KingdomPost-non-dom landscape: the FIG regime offers 4 years of foreign-income relief, then full worldwide taxation kicks in.United Arab EmiratesUnited Arab Emirates0% personal income tax, world-class infrastructure, and a 90-day residency pathway via Dubai or Abu Dhabi.ItalyItalyThe €300k lump-sum tax on foreign income for new residents — a predictable 15-year regime for internationally mobile wealth.