NON-DOMS escaped the budget without the crackdown some were expecting but Osborne says he will raise an extra £200m from them over the coming years.
A raft of new rules were applied to non-doms – people residing in the UK, but not domiciled here to avoid paying UK tax on their foreign earnings, the most striking of which was an additional £20,000-a-year charge to those who have been in the UK for 12 years or more. This is on top of the existing £30,000 charge for those residing in the UK for seven years or more to total £50,000.
However, Osborne also scrapped the tax charge for those bringing money into the UK to invest in a British business. He also said there will be no other major charges for non-doms over the course of the parliament – a move aimed at creating stability that will stop wealth generators from leaving the UK.
The rules will apply to the 120,000 overseas taxpayers who are resident in Britain. There were fears a crackdown could damage the competitive advantage enjoyed by many non-doms and drive them out of the country, along with their lavish spending and the tax receipts they provide the Treasury.