INTM601960 - Transfer of assets abroad: Non-domiciled individuals taxation up to 5 April 2025: The Income charge - introduction

The basic provisions that describe whether an individual is liable to an income charge and, if so, how much is chargeable, are contained in INTM600520 onwards.

This part of the manual proceeds on the basis that a potential charge was established and considers the possible effect on that charge if the individual was non-UK domiciled.

Whether or not an individual was non-UK domiciled is not a matter for this manual.

This part of the manual looks at the effect of being non-UK domiciled on the income charge in three stages:

  • the position up to 5 April 2005 under ICTA88/S739 - before the introduction of the Income Tax Trading and Other Income Act 2005 (ITTOIA).
  • the position between 6 April 2005 and 5 April 2008 under ICTA88/S739 - after the introduction of ITTOIA, and the effect of the introduction of Income Tax Act 2007.
  • the position from 6 April 2008 under ITA07/S726 and S730 - after changes brought in by the Finance Act 2008.

There were further changes in relation to the application of ITA07/S720 and S727 with the introduction of the UK deemed domiciled rules in Finance (No. 2) Act 2017 that removed protected foreign-source income from the income charge in respect of non-resident trusts settled by non-UK domiciled and certain UK deemed domiciled individuals. The changes are discussed at INTM603180 onwards.

From 6 April 2025 the rules around the taxation of non-UK domiciled individuals ended and individuals are taxable based on their residence position only. This section on non-domiciled individuals only applies to the treatment of non-UK domiciled individuals for the years up to and including 2024 - 2025. Detailed guidance on the changes from 6 April 2025 can be found at INTM603615 onwards.

Any issues concerning whether an individual is UK resident or UK domiciled should be determined from the separate guidance on those subjects, or by consulting the relevant technical specialist in Personal Tax International, Liverpool (see INTM604440).