Non-doms add almost £10bn to UK coffers
The UK government today published statistics showing a direct contribution in tax receipts of £9.3bn from those with non-domiciled taxpayer status, comprising income tax, capital gains tax and national insurance contributions (mandatory pension and welfare payments).
The report, named Statistics on Non-Domiciled Taxpayers in the UK, is the first such publication of its kind and can be found here on Her Majesty’s Revenue and Customs (HMRC) website.
The report will henceforth be published annually and it covers the years from 2007-2008 up to 2014-2015.
As well as the contribution of £9.3bn in tax receipts, the report reveals that the Remittance Basis Charge, a levy paid by non-dom taxpayers, accounts for just £226m.
Commenting upon this, partner Steven Porter at law firm Pinsent Masons (pictured left) said: “The Remittance Basis Charge was introduced to extract more tax from non-doms. However, non-doms will be keen to avoid being used as a cash-cow. The Government must be careful not to drive them out.”
This wasn’t the only reason for concern over the government’s policy toward non-doms, said Porter, adding: “The removal of long-term non-dom status earlier this year may have also blunted the attractiveness of the UK to wealthy individuals. Many are internationally mobile and can easily relocate.”
‘Exponential benefits from non-doms as entrepreneurs and employers’
Porter added that there are exponential tax benefits that non-doms bring to the UK economy, pointing out that many non-doms are “highly successful entrepreneurs and business people” and that, for the most part, they are in the UK setting up, running or investing in UK businesses, or European businesses with a significant UK base, thereby creating thousands of jobs and hence adding to Treasury coffers through their employees and subcontractors.
‘Brexit effect on non-doms yet to register’
Scare stories about European non-doms abandoning the UK in the light of Brexit are not documented here as this report only covers the period up until April 2015, and hence does not include the period post-referendum.
However, Porter noted, in these figures, the latest on record, the total number of taxpayers claiming a non-dom status had marginally increased over the last year covered by the report.
Last month, as reported, long-standing plans to change the non-dom taxation system in the UK, originally scheduled to go live in April, were rubber stamped by HM Treasury to be implemented “as soon as possible”.