London Daily

Focus on the big picture.
Thursday, Jul 24, 2025

Following Sunak’s tax evasion scandal: What is non-domicile status and who qualifies?

Following Sunak’s tax evasion scandal: What is non-domicile status and who qualifies?

How being registered as such with HMRC works and affects tax
What is non-domicile status?


A person who is registered as non-domiciled with HM Revenue and Customs is tax resident in the UK but does not have to pay UK tax on income and capital gains earned overseas – including on company stocks or cash made from selling a second home – unless they bring their money into the UK or deposit it into a UK bank account. However, non-doms do still have to pay tax on money earned within the UK.

Who qualifies as a non-dom resident?


A person with non-dom status is someone who lives in the UK and is tax resident here, but who has their permanent home outside the country. They must demonstrate to HMRC that their domicile – at least for tax purposes – is in another country. Usually their domicile will be the country that their father considered their permanent home when they were born, and to which they intend to eventually return, perhaps when they retire.

Because they are tax resident in the UK, non-doms will typically not be tax resident in their country of domicile, and therefore not liable for tax in either country on their worldwide income.

Non-doms have to specifically apply for a tax exemption on foreign income of more than £2,000, meaning it is not an automatic designation for foreign-born residents or non-citizens.

How long does the non-dom tax break last?


After a certain amount of time, non-doms must pay a hefty charge in order to continue sheltering their foreign income from UK tax. Those who have been living in the UK for at least seven of the previous nine tax years must pay £30,000 a year to the government. Those who have lived in the UK for 12 of the previous 14 tax years must pay £60,000 a year. UK residents must pay tax on their worldwide earnings once they have been in the country for 15 of the previous 20 years.

Foreign nationals who are resident in the UK can choose to pay British taxes at any point on their worldwide income and capital gains. They do not have to hold a UK passport to be taxed here.

Why is it controversial?


The rule primarily benefits the very rich, and has allowed those claiming it to avoid paying significant sums to HMRC.

A study by the London School of Economics and the University of Warwick found that more than two-fifths of people who earned £5m or more in 2018 had claimed non-dom status at some point since 1997.

Some of the highest earning non-doms work in the film industry and sport, including famous actors, directors, producers and Premier League football players, according to the report, which also found that 22% of top-earning bankers have benefited from the scheme.

Some of the highest earning non-doms work in the film industry and sport.


Which big names have claimed UK non-dom status?


Some of the most well-known people who have reportedly claimed non-dom status include Roman Abramovich, the Russian oligarch and owner of Chelsea football club now under sanctions, the steel tycoon Lakshmi Mittal and the media baron and Daily Mail owner, Lord Rothermere.

Lord Ashcroft, the multimillionaire and former deputy chairman of the Conservative party, and the former HSBC boss Stuart Gulliver were also reported to have used the non-dom scheme. The same applied to Sir James Goldsmith and his children, including the Conservative minister and longtime friend of Boris Johnson, Zac Goldsmith.

What about the chancellor’s wife?


It emerged on Wednesday that Rishi Sunak’s wife, Akshata Murty, claims non-dom status, allowing her to potentially save millions of pounds in tax on dividends collected from her family’s IT business empire.

Murty’s father is the billionaire founder of the Indian-headquartered company Infosys, in which she holds a 0.9% stake. Her non-dom status means she is not liable to pay the 39.35% tax applied to dividend payouts for UK-resident taxpayers in the highest income band.

A spokesperson for Murty confirmed she has opted to pay the £30,000 annual levy so that she is not taxed in the UK on her foreign income.

The Guardian estimates Murty has collected £54.5m (5.4bn Indian rupees) in dividends from Infosys since 2015, the earliest date for which the relevant information is available. Had she been paying UK tax on that income, she would have been liable for as much as £20m. She may not avoid UK tax indefinitely.

Under current law, Murty will automatically be deemed domiciled after living in the UK for a total of 15 years. Murty, who married Sunak in 2009, soon after they met while she was studying for a master’s in business administration at Stanford University in Silicon Valley, is understood to have moved to the UK in 2015.

Her tax arrangement is legal and it is understood the chancellor declared his wife’s status to the Cabinet Office when he took office in 2018. A spokesperson for Murty has said she “has always and will continue to pay UK taxes on all her UK income”.

However, Labour has criticised Sunak for imposing tax increases on working households while his wife benefits from a scheme that has tended to help the wealthiest in the UK avoid national levies.

Newsletter

Related Articles

0:00
0:00
Close
Politic is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
Thai Civilian Death Toll Rises to 12 in Cambodian Cross-Border Attacks
TSUNAMI: Trump Just Crossed the Rubicon—And There’s No Turning Back
Over 120 Criminal Cases Dismissed in Boston Amid Public Defender Shortage
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
The Podcaster Who Accidentally Revealed He Earns Over $10 Million a Year
Trump Announces $550 Billion Japanese Investment and New Trade Agreements with Indonesia and the Philippines
US Treasury Secretary Calls for Institutional Review of Federal Reserve Amid AI‑Driven Growth Expectations
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Severe Flooding in South Korea Claims Lives Amid Ongoing Rescue Operations
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
CEO Resigns Amid Controversy Over Relationship with HR Executive
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
US Revokes Visas of Brazilian Corrupted Judges Amid Fake Bolsonaro Investigation
U.S. Congress Approves Rescissions Act Cutting Federal Funding for NPR and PBS
North Korea Restricts Foreign Tourist Access to New Seaside Resort
Brazil's Supreme Court Imposes Radical Restrictions on Former President Bolsonaro
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Judge Criticizes DOJ Over Secrecy in Dropping Charges Against Gang Leader
Apple Closes $16.5 Billion Tax Dispute With Ireland
Von der Leyen Faces Setback Over €2 Trillion EU Budget Proposal
UK and Germany Collaborate on Global Military Equipment Sales
Trump Plans Over 10% Tariffs on African and Caribbean Nations
Flying Taxi CEO Reclaims Billionaire Status After Stock Surge
Epstein Files Deepen Republican Party Divide
Zuckerberg Faces $8 Billion Privacy Lawsuit From Meta Shareholders
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
SpaceX Nears $400 Billion Valuation With New Share Sale
Microsoft, US Lab to Use AI for Faster Nuclear Plant Licensing
Trump Walks Back Talk of Firing Fed Chair Jerome Powell
Zelensky Reshuffles Cabinet to Win Support at Home and in Washington
"Can You Hit Moscow?" Trump Asked Zelensky To Make Putin "Feel The Pain"
Irish Tech Worker Detained 100 days by US Authorities for Overstaying Visa
Dimon Warns on Fed Independence as Trump Administration Eyes Powell’s Succession
Church of England Removes 1991 Sexuality Guidelines from Clergy Selection
Superman Franchise Achieves Success with Latest Release
Hungary's Viktor Orban Rejects Agreements on Illegal Migration
Jeff Bezos Considers Purchasing Condé Nast as a Wedding Gift
Ghislaine Maxwell Says She’s Ready to Testify Before Congress on Epstein’s Criminal Empire
Bal des Pompiers: A Celebration of Community and Firefighter Culture in France
FBI Chief Kash Patel Denies Resignation Speculations Amid Epstein List Controversy
Air India Pilot’s Mental Health Records Under Scrutiny
Google Secures Windsurf AI Coding Team in $2.4 Billion Licence Deal
Jamie Dimon Warns Europe Is Losing Global Competitiveness and Flags Market Complacency
×