Since 6 April 2025 domicile no longer decides how UK residents are taxed on foreign income and gains, and long term UK residence has replaced it as the test for inheritance tax. Domicile still has an effect in several places: tax years and deaths before that date, trusts set up before the change, transitional rules for people who left the UK, older inheritance tax treaties, and one condition of the capital gains rebasing for former remittance basis users.

What replaced domicile in April 2025?

HMRC’s manuals describe the change in the same words: the concept of domicile as a relevant connecting factor in the tax system has been replaced by a system based on tax residence (RDRM30005). For income tax and capital gains tax, all UK residents are taxed on the arising basis on worldwide income and gains, and 2024 to 2025 was the last year the remittance basis could apply. New arrivals after at least 10 consecutive years of non residence can claim relief under the four year foreign income and gains regime, which does not depend on domicile (RFIG41000).

For inheritance tax, a person is in scope on worldwide assets if they are a long term UK resident, broadly resident for at least 10 of the previous 20 tax years (IHTM47001). Residence is decided under the statutory residence test.

Does domicile still decide anything for earlier years?

Yes. IHTM47001 lists the cases where domicile remains relevant for inheritance tax, starting with deaths and lifetime transfers of value before 6 April 2025. An estate of someone who died in March 2025 is still tested on domicile and deemed domicile, so the common law questions about domicile of origin and choice can still arise when HMRC investigates a domicile claim made on form IHT401 (IHTM13011).

The same applies to income tax and capital gains tax for 2024 to 2025 and earlier. Whether someone was entitled to the remittance basis in those years depended on their domicile, and foreign income and gains from remittance basis years remain taxable at normal rates if brought to the UK after 6 April 2025, unless designated under the temporary repatriation facility (RDRM30005). An open enquiry into an earlier year can therefore still turn on domicile.

How does domicile affect trusts set up before the change?

This is where domicile has the longest tail. Under IHTM47001:

  • Charges before 6 April 2025 on foreign settled property depend on the settlor’s domicile when the property was added.
  • Settlor died before 6 April 2025. Later charges on foreign settled property still depend on the settlor’s domicile when the property became settled, not on long term residence.
  • Gifts with reservation. Foreign property that was excluded property in a settlement on or before 30 October 2024 is not caught by the reservation of benefit rules on the settlor’s death, provided it stays settled and is situated outside the UK (or held in authorised unit trusts or OEICs) at that time (IHTM47060).
  • Qualifying interest in possession trusts settled before 30 October 2024 have similar protection from certain charges (IHTM47051).

For both transitional rules, whether the property was excluded property at 30 October 2024 depends on the settlor’s domicile when it entered the trust. HMRC’s example is a settlor with a South African domicile of origin who settled foreign shares in 2010 before moving to the UK: those shares stay outside the reservation of benefit charge even if she dies as a long term UK resident, but the trust still falls into the relevant property regime while she is long term resident (IHTM47060). Additions or new settlements on or after 30 October 2024 get no such protection. The ten year and exit charges are covered in excluded property for inheritance tax.

Domicile also survives in the capital gains residence test for trustees. Where a trust has a mix of UK and non UK resident trustees, it is UK resident if a settlor was UK resident at the relevant time. For settlements made before 6 April 2025, section 69(2CA) TCGA 1992 reads that condition as resident or domiciled, with deemed domicile counting (section 69(2F)). See offshore trusts with UK beneficiaries.

What about people who left the UK around the change?

IHTM47021 sets out transitional rules for individuals who were not UK domiciled, or were deemed domiciled, and are non resident in 2025 to 2026:

  • someone who was neither domiciled nor deemed domiciled on 30 October 2024 and becomes non resident in 2025 to 2026 is not a long term UK resident;
  • someone deemed domiciled on 30 October 2024 who becomes non resident in 2025 to 2026 stays a long term UK resident until the start of their fourth year of non residence;
  • the old 15 out of 20 year deemed domicile test is used for these people.

The transitional rule does not help anyone who was UK domiciled under common law on 30 October 2024; the new test applies to them straight away. So an emigrant’s common law domicile at that date can decide which set of rules applies. Anyone who returns to the UK falls under the normal long term residence test, counting earlier years of residence.

How do tax treaties use domicile?

The UK has inheritance tax treaties with ten countries: Ireland, the Netherlands, South Africa, Sweden, the USA, Switzerland, France, India, Italy and Pakistan (IHTM27161). The later treaties refer to people domiciled under general law or treated as domiciled for UK inheritance tax, and from 6 April 2025 a long term UK resident is treated as domiciled for that purpose (IHTM47070, IHTM47071). Several of those treaties also protect trusts made by settlors who were fiscally domiciled in the other country, such as the US treaty where the settlor was US domiciled and not a UK national when the trust was made.

The four pre 1975 treaties, with France, Italy, India and Pakistan, apply only on death and work on common law domicile, not deemed domicile (IHTM47072). Under the India and Pakistan treaties the UK can tax only UK assets where the person’s common law domicile is in that country. Spousal domicile elections and long term residence elections are ignored when applying any treaty (section 267ZF(3) and (4) IHTA 1984, IHTM47070).

Does domicile still affect capital gains for former non doms?

Yes, in one specific relief. The option to rebase foreign assets to 5 April 2017 is only available to someone who was not domiciled or deemed domiciled in the UK in any tax year before 2025 to 2026 (paragraph 1(1)(d) and (5) of Schedule 11 to the Finance Act 2025). Someone who acquired a UK domicile of choice, or became deemed domiciled under the 15 year rule, before April 2025 cannot use it.

Are there other places domicile still appears?

  • Spousal elections. An election under section 267ZA or 267ZB to be treated as UK domiciled can still be made after 6 April 2025 for a period before that date; later periods use the new long term residence election (IHTM47031).
  • Succession. HMRC notes that common law domicile decides which succession rules apply to movable property, wherever it is (IHTM13001), so it still affects who inherits.

What mistakes come up in practice?

  • Assuming domicile is now irrelevant and discarding domicile evidence for older trusts and estates.
  • Applying the long term residence test to a trust whose settlor died before 6 April 2025.
  • Relying on transitional protection for property added to a trust after 30 October 2024.
  • Reading deemed domicile into the French, Italian, Indian or Pakistani treaties.
  • Treating a spousal election as effective for treaty purposes.

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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.