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On 26 November 2025, the Chancellor of the Exchequer delivered the second Autumn Budget of the Labour Government. It follows last year’s announcements of the abolition of the tax regime for UK resident non-UK domiciliaries (RNDs) and the introduction of a residence-based tax regime for the taxation of foreign income and gains known as the “FIG regime” and a new 10/20-year rule for inheritance tax (IHT).
This Budget is less far-reaching than last year’s but contains some changes for those previously taxed on the RND regime, particularly with regard to IHT. In particular, the IHT charges that were announced in last year’s Budget for excluded property trusts seem to be alleviated through the introduction of a GBP 5 million IHT cap every ten years. This represents a welcome grandfathering (to some extent) of formerly excluded property settlements and suggests that the government has listened to calls from the industry. It means that individuals previously taxed on the RND regime who have ceased UK tax residence (or were planning to cease UK tax residence), following last year’s Budget may be persuaded to remain in, or return to, the UK.
The government has not yet reformed the offshore trust/non-UK company attribution rules (although it says it remains committed to an ambitious reform and substantial simplification of these rules). Until those changes occur, there may be opportunities for former RNDs to live in the UK with limited exposure to UK taxation.
In addition, the government also announced its intention to further develop its “tax offer for high-talent new arrivals,” which the Budget day documents refer to as an “enhanced offer.” While no details are yet available, if such an “offer” includes improved immigration options together with associated tax benefits it is welcome news. A summary of the key takeaways is below.
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