UK Sees Non-Dom Population Drop By Almost 37%: Where Are They Going?

Recent research by Astons has revealed just how many of the UK’s non-dom population are leaving the country.

This exodus of high-net-worth individuals has been sparked by the UK’s latest tax policies, which make their global income (not just income generated in the UK) liable to taxation.

Chancellor Rachel Reeves announced this new policy in her latest budget, which has unsurprisingly sparked many to move abroad in search of more favourable tax environments across Europe.

 

What Does Non-Dom Mean?

 

The term ‘non-dom’ is used to describe a person who lives in a country, but does not register it as their permanent home for tax purposes.

This allows them to only pay tax on income generated within that country, and none on income from elsewhere, whilst also enjoying the country’s social services and quality of life.

In essence, they can choose to live in one country, but pay tax on the majority of their income elsewhere.

In the most recent budget, as Labour tries to increase tax revenue, chancellor Rachael Reeves put forward a residency-based tax system, where a person’s residency, over their domicile, impacts where they pay tax.

For non-doms, this means that all income, even that which has been generated outside the UK, is liable to UK tax rates, which can be as high as 40%.

This has caused many UK non-doms to leave the country, in search of a better tax deal elsewhere.

 

High Net Worth Individuals Leave The UK

 

A recent report from New World Wealth estimates that the UK lost 16,500 millionaires in the six years following Brexit, and predicted a further 9,500 will have left before the end of 2024.

A separate Global Wealth Report 2024 by UBS predicts that by 2028, the UK will see a -17% drop in its millionaire population, which is nearly 500,000 people – the largest wealth exodus among the nations within the study.

 

 

Where Are The Wealthy Moving To?

 

Many high-net-worth-individuals (HNWIs) are looking to head to other  European countries for better economic environments and more favourable tax policies.

For those leaving the UK, gaining access and free movement within the EU following Brexit is a huge benefit. For US-leavers countries like Portugal, Malta, Spain, Italy and, in particular, Greece are also incredibly popular.

These European destinations are desirable for a number of reasons, including their cultures and political stability, as well as favourable tax regimes and great real estate opportunities.

In response to this, many of these countries have launched Golden Visa programmes to make it easier for these HNWIs to immigrate there.

 

Why is Greece A Top Destination For The World’s HNWIs?

 

Over the past three years alone, 1,200 millionaires have migrated to Greece (Yahoo), and at last counting, the nation’s millionaire population was believed to be 80,655.

Driving factors include Greece’s attractive Golden Visa programme which grants a five-year family residency for the low investment of €250,000.

The country offers political and economic stability, a stunning quality of life, good education, and doesn’t even ask investors to physically live in the country for long periods of time.

 

Golden Visa Benefits in Greece

• Low investment threshold: Starting at €250,000 for commercial properties that are converted into residential ones.
• No residency requirement: Investors do not need to live in Greece to maintain their visa.
• Tax advantages: Non-dom retirees pay a flat 7% tax on foreign pensions, while high-net-worth individuals can opt for a flat annual tax of €100,000 on all foreign-sourced income for up to 10 years.
• Visa-free travel: Residency allows access to the Schengen Zone without extra visas.

 

Citizenship, residence permit, and real estate investment expert for Astons, Alena Lesina, commented: “Greece has long been a much-favoured destination for HNWIs leaving both the UK and the US, but we’ve seen demand soar over the past 12 months.

“Greece’s Golden Visa requirements are highly attractive and provide a great opportunity to earn great real estate investment returns in a favourable tax environment. Add to this nation’s generous retiree and expat non–dom tax rules and it’s easy to see why Greece is fast becoming Europe’s leading Golden Visa destination.

“And while Greece’s programme is booming, Spain has recently ended its own Golden Visa programme which has resulted in even more UK and US leavers turning their attention to Greece. 2024 was a stellar year for Greece, and their economy is benefiting as a result. Now all signs are pointing to 2025 being even busier.”

 

The Popularity Of Golden Visas Across Europe

 

With Spain discontinuing its Golden Visa programme, Greece is expected to attract even more global investors in 2025.

Other countries, including Portugal and Italy, are continuing to drive their programmes to bring more people in, but are also looking at how this might affect the local population.

As the UK’s tax regime becomes even more complicated, many are wondering whether this short-term money grab is worth it for the long-term impact that losing so many millionaires will have on the economy.

Only time will tell.