𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Rachel Reeves has been warned that tweaking her stance on non-doms will not stop a mass migration of wealth from the UK.

The Chancellor announced last month that changes would be made to her plan to abolish the financial status—which applies to residents whose permanent homes for tax purposes are located outside the country—which would make it easier for individuals to repatriate their funds to Britain.

Previous foreign earnings now will not be subject to taxes when moved between overseas accounts. Labour promised to scrap the categorisation in their manifesto for the 2024 general election.

Now, global financial advisory firm the deVere Group has warned that the new measure “does nothing to reverse the damage already inflicted”.

The company adds that it has seen a “surge” in clients “actively seeking alternative jurisdictions”, such as Dubai, Italy and Switzerland, and “Britain has made itself an unwelcoming environment for internationally wealthy individuals”.

Its CEO, Nigel Green, said: “This revision is a small technical fix, but it doesn’t alter the bigger picture. High-net-worth individuals have already drawn their conclusions and are making moves accordingly.”

He then went on to describe the “real issue” – inheritance tax.

Mr Green added: “Previously, non-doms had a clear understanding of how their wealth would be treated. That framework has now been upended, leaving them exposed in ways they never anticipated.”

Larger reform is needed, the finance expert thinks. He said: “If policymakers want to halt the outflow of capital and talent, they need to go beyond cosmetic tweaks and tackle the real deterrent: IHT.”

“This minor adjustment does nothing to alter the fact that without meaningful reform, the mass migration of wealth will continue unabated.”

It comes after a report by investment advisors Henley and Partners found that more than 10,000 millionaires left the UK in 2024. This represented a 157% increase compared to 2023.

Experts think, however, that the actual number is even higher. This is because the net figure also includes the millionaires who arrived in the UK.