The remittance basis let UK residents who were not UK domiciled leave foreign income and gains untaxed for as long as the money stayed outside the UK, in return for losing allowances and, after seven years, paying an annual charge. The foreign income and gains (FIG) regime that replaced it from 6 April 2025 is open to anyone arriving after 10 consecutive tax years of non residence, lasts only four tax years, and lets relieved income be brought to the UK with no tax charge at all.

Why compare a regime that no longer exists?

From 6 April 2025 every UK resident is taxed on the arising basis on worldwide income and gains, and the remittance basis cannot be used for 2025 to 2026 or later years (RFIG41000). The old rules still matter in practice for three reasons. Former remittance basis users still have pools of pre April 2025 foreign income and gains that are taxed if they are brought to the UK. Advisers meeting new arrivals often hear “I thought I could just keep it offshore”. And the two regimes reward very different behaviour, so planning built for one can go badly wrong under the other.

The full mechanics of the new relief are on our page about the four year foreign income and gains regime. This page sets the two side by side.

Who could use each regime?

Under section 809B of the Income Tax Act 2007, the remittance basis was available to an individual who was UK resident, was not domiciled in the UK in the year and made a claim (RDRM32010). From 6 April 2017 two groups were shut out because they were deemed domiciled: people born in the UK with a UK domicile of origin who had come back (Condition A), and people resident in the UK for at least 15 of the previous 20 tax years (Condition B), as explained at RDRM32015. Domicile, a common law concept about where a person’s permanent home is, was the gateway.

The FIG regime ignores domicile and nationality. Under section 845B of the Income Tax (Trading and Other Income) Act 2005 a person is a qualifying new resident for a tax year if they are UK resident under the statutory residence test, were not UK resident for at least 10 consecutive tax years immediately before it, are not a member of either House of Parliament and are at least 10 years old, and then for the three following tax years in which they remain resident (RFIG44000). HMRC’s example of Marie, a UK domiciled person who returned after 11 years in Australia, shows that a returning British expatriate can qualify, which the remittance basis would never have allowed.

How long did each last?

The remittance basis had no end date as such. A non domiciled person could claim it year after year, but the price rose with time. A person resident for at least seven of the previous nine tax years paid a remittance basis charge of £30,000, rising to £60,000 after 12 of the previous 14 years, and from 2017 the 15 year deemed domicile rule ended access completely (RDRM32210).

The FIG regime is fixed by the calendar. The four years are the first year of qualifying residence and the three following years, whether or not claims are made, and a year of non residence inside that window is simply lost (RFIG44000). After that, the person is taxed on the arising basis like any other resident until they spend another 10 consecutive years abroad.

What does each regime cost?

Point Remittance basis (to 5 April 2025) FIG regime (from 6 April 2025)
Personal allowance and blind person’s allowance Lost on a section 809B claim Lost on any foreign income claim, foreign gain claim or overseas workday relief election
Capital gains annual exempt amount Lost on a section 809B claim Lost on any claim or election
Annual charge £30,000 or £60,000 for long term residents aged 18 or over None
Small amounts Applied without a claim, and without losing allowances, where unremitted foreign income and gains were under £2,000 No de minimis; every source must be claimed
Foreign losses Relief for foreign capital losses depended on an election under section 16ZA of the Taxation of Chargeable Gains Act 1992 Foreign trading, property and capital losses of a claim year are lost

The sources for the table are RDRM32040, RDRM32060, RDRM32135 and RDRM32210 for the old rules and RFIG43000 for the new. Under the FIG regime adjusted net income is worked out as if the relief had not been given, so relieved foreign income still counts for the High Income Child Benefit Charge and the tapering of allowances.

What happens when the money comes to the UK?

This is the biggest practical difference. Under the remittance basis, foreign income and gains were taxed when they were brought to, received in or used in the UK, when they paid for a service provided in the UK, or when they were used abroad to pay a debt relating to something in the UK (RDRM31030). Money in a mixed fund overseas had to be traced through the statutory ordering rules in section 809Q of the Income Tax Act 2007.

Under the FIG regime the location of the money is irrelevant. HMRC states at RFIG41000 that individuals are not required to bring relieved income and gains to the UK, and if they choose to there is no tax liability when they do.

The old rules have not disappeared for old money. Foreign income and gains that arose to a remittance basis user before 6 April 2025 are still taxed at the usual rates if remitted on or after that date (RDRM31030). A former remittance basis user who comes back after 10 years away and qualifies for the FIG regime cannot use it for that pre 2025 money either (RFIG41000). The intended route is the temporary repatriation facility, which charges 12% on amounts designated for 2025 to 2026 or 2026 to 2027 and 15% for 2027 to 2028 (RDRM73400).

How was each one claimed?

A remittance basis claim was made on the Self Assessment return and had to include a statement that the person was not domiciled in the UK (RDRM32010).

A FIG claim is made on the residence and FIG regime pages (SA109) and must identify and quantify each source of foreign income or gain being relieved. The time limit is the first anniversary of the normal 31 January filing date, so for 2026 to 2027 claims must be in by 31 January 2029, and there is no discretion to accept late claims (RFIG42300). Foreign employment income is not covered by the FIG claim itself; the separate overseas workday relief election deals with earnings for duties performed abroad.

How does the difference look in practice?

Illustration only. Lena moves to London in May 2026, having never lived in the UK. She has a UK salary and £40,000 a year of dividends from an overseas portfolio.

  • Under the old rules she could have claimed the remittance basis, lost her personal allowance of £12,570, and paid no UK tax on the dividends while they stayed abroad. Spending them in the UK would have triggered tax at her full rates. From her eighth year she would also have faced the £30,000 charge.
  • Under the FIG regime she claims relief on the £40,000 for 2026 to 2027 and each of the next three years, again losing her personal allowance, which costs at least £2,514 at the 20% basic rate. She can transfer the dividends to her UK account whenever she wants without any tax. From 2030 to 2031 every pound of dividends is taxable as it arises, wherever it is kept.

Whether a claim is worth making is a year by year calculation. Someone with modest foreign interest and a large UK salary may lose more through the allowance than they save.

What mistakes come up?

  • Assuming offshore income is still safe because it has not been brought in. That only worked under the remittance basis.
  • Treating a long term non domiciled resident as eligible for the FIG regime. Eligibility depends on 10 years of non residence, not on domicile.
  • Forgetting that a split year or a year of treaty residence elsewhere counts as a year of UK residence for the 10 year test (RFIG44000).
  • Bringing pre April 2025 foreign income to the UK without first considering a designation under the temporary repatriation facility.
  • Making a single global FIG claim instead of quantifying each source.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 19 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.