UK wealth outflows intensify as tax uncertainty prompts relocations

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UK wealth outflows prompt relocations

Highlights

Chris Rokos's relocation to Greece highlights increasing UK wealth outflows due to higher taxes and unpredictable fiscal policy, worrying London financial circles.
The number of non-doms dropped by only 0.5 per cent to 73,400 in 2024-25 after abolition of the non-dom regime, but advisers warn actual departures may be higher.
Revised UK inheritance tax targets assets above £1mn at 20 per cent and foreign assets post-Reeves crackdown, prompting concerns about succession planning for family businesses.

Tax pressure and relocation planning

As first reported by Financial Times, discussion among business and finance figures in London has turned to the departure of Chris Rokos, founder of Rokos Capital Management, from the UK to Greece. His move sharpens concerns that higher taxes and an unpredictable policy climate are pushing wealthy financiers and entrepreneurs to consider relocating.

The issue comes at a delicate moment for the government. Labour chancellor John Healey is warning of a difficult Budget next month, while Bank of England governor Andrew Bailey says UK inflation risks are "on the upside". Wealth advisers say clients are struggling to plan for the long term because of repeated tax changes and uncertainty over what may come next.

The pressure has built over roughly a decade, beginning with moves against the non-dom regime under former chancellor George Osborne. That regime is abolished in March 2024 under Jeremy Hunt, and Rachel Reeves later proposes further tightening. Over the past two years, taxes have also increased on inheritances, pension pots, private equity profits, employer national insurance contributions and capital gains, while the possibility of a windfall tax on banks remains in play.

Inheritance rules and risks for business

HM Revenue & Customs figures show the number of non-doms falls by less than 1 per cent immediately after ministers confirm the end of the favourable tax status. About 73,400 individuals claim non-domiciled taxpayer status in 2024-25, down 0.5 per cent, or 400, from the previous year, although private banks, wealth managers and advisers say the real scale of departures is higher.

For many wealthy families, inheritance tax is the central concern. Advisers and high-net-worth individuals say the UK’s 40 per cent inheritance tax above a set threshold is among the highest in developed economies, and foreign assets can no longer be shielded from the tax after the Reeves crackdown. Some business owners also face new limits on inheritance tax relief for business property, with assets above £1mn now taxed at 20 per cent, raising fears over succession planning for family companies.

Lawyers and advisers say those changes can become existential for businesses that may need to raise large amounts of cash to meet a tax bill. The government says it wants Britain to remain a country of wealth creation, and the new regime offers qualifying new residents full tax relief on foreign income and gains for their first four years of UK tax residence. But advisers argue the window should be longer, and some say a flat-tax model similar to Italy or Greece would better help the UK compete as other European countries move quickly to attract mobile wealth.

Our earlier article examined the government’s pre-Budget stance on student loan repayment rules, including its refusal to lift the freeze on the earnings threshold at which graduates start repaying. We also noted that ministers are prioritizing wider fiscal constraints and a push to get nearly a million young people not in education, employment, or training into work, while offering only limited near-term relief for borrowers facing rising repayment burdens.

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