From 6 April 2025 the UK abolished its 225-year-old domicile-based tax system and replaced it with a residence-based regime. For property investors the headline mechanics are three new instruments operating in parallel: a four-year Foreign Income and Gains (FIG) exemption for qualifying new arrivals, a three-year Temporary Repatriation Facility (TRF) to bring pre-April-2025 foreign income onshore at concessional rates, and a one-off CGT rebasing election to 5 April 2017 for foreign-situs assets held by ex-remittance-basis users. UK property remains taxed as before: UK source rental income inside UK tax regardless of the owner's residence or FIG status, UK situs assets always within IHT once long-term residence is established.

This page covers the property-investor angle on the reform. The four-year FIG window is the most-discussed instrument, but the more practically important questions for property investors are typically (1) what FIG covers and (more critically) does not cover for a portfolio holding both UK and foreign property, (2) when the TRF makes sense for an existing remittance-basis user with accumulated foreign rental income, and (3) how the 5 April 2017 CGT rebasing election interacts with foreign property disposals planned for after arrival. One anonymised scenario (Anika, a Mumbai-born surgeon arriving in the UK in September 2026 with an Indian rental portfolio and a London BTL) carries the figures through.

What the April 2025 reform replaced

The pre-April-2025 regime allowed UK-resident, non-UK-domiciled individuals to elect the remittance basis: foreign income and gains were not taxed in the UK unless brought (remitted) here. A remittance basis user paid an annual charge (£30,000 after 7 of 9 years UK resident, rising to £60,000 after 12 of 14 years; not available beyond 15 of 20 years, at which point deemed domicile kicked in). Domicile (the country of permanent home in general law) sat at the centre of both income tax and inheritance tax. The system was administratively complex, opaque to outsiders, and politically vulnerable.

From 6 April 2025 domicile ceases to be relevant for UK tax purposes. Three mechanics replace the regime:

  • A four-year FIG exemption for new arrivals (with a 10-tax-year qualifying lookback).
  • A three-year Temporary Repatriation Facility at 12% / 12% / 15% for ex-remittance-basis users to onshore pre-April-2025 foreign income and gains.
  • A 5 April 2017 CGT rebasing election for foreign-situs assets held by individuals who claimed the remittance basis between 2017/18 and 2024/25.

Inheritance tax also moves to a residence basis, with the long-term resident test (10 of 20 years, or 10 consecutive years per HMRC's two-route framing) replacing the deemed domicile test for IHT scope. UK situs property and Schedule A1 IHTA 1984 look-through structures are unaffected by the change; the residence test alters scope on worldwide assets, not UK assets.

The 4-year FIG regime: eligibility and scope

A qualifying individual pays no UK tax on foreign income and foreign gains arising in their first four tax years of UK residence. Eligibility requires:

  • The individual is UK tax resident for the year in which FIG is claimed.
  • The individual was not UK tax resident in any of the ten tax years immediately preceding the first year of qualifying UK residence.
  • The four-year window runs from the first year of qualifying UK residence and is fixed; it cannot be paused for a year of non-residence and resumed.
  • The election is made annually on the SA109 residence supplement and is opt-in per year.

The election surrenders the personal allowance (£12,570 in 2026/27) and the CGT annual exempt amount (£3,000) for the year in which it is made. This is the per-year economic cost of FIG: roughly £2,514 of income tax (£12,570 at the basic rate) plus £540 (£3,000 at the 18% CGT residential rate) for an investor whose foreign income would otherwise have been below those thresholds. For inbound HNW investors with material foreign income these surrenders are immaterial against the FIG benefit; for inbound retirees with modest foreign pensions or rentals the maths can flip the other way.

The 10-tax-year non-residence test is strict. A single year of UK tax residence within the lookback disqualifies. Returning Britons need to check the SRT outcome for every one of the 10 years before assuming FIG eligibility; a single year of accidental UK residence (often from family ties accumulating during what was assumed to be a clean overseas spell) breaks the chain.

What FIG covers for property investors (and what it does not)

FIG covers foreign source income and foreign chargeable gains. For a property investor the practical map:

  • Foreign rental income on foreign property: inside FIG. A Madrid apartment producing €30,000 of rent for a qualifying inbound investor sits outside UK tax during the four-year window.
  • Foreign chargeable gains on foreign property disposals: inside FIG. Selling that Madrid apartment in year 2 with a €100,000 gain produces no UK CGT during the window (the Spanish side is separate, taxed under Spanish rules).
  • UK rental income on UK property: outside FIG. UK source income under section 264 ITTOIA 2005, taxable in the UK on the arising basis regardless of FIG status, with the section 24 reducer and personal allowance applying (subject to the FIG-year personal-allowance surrender). A London BTL held by a FIG-claiming investor pays UK income tax as for any UK landlord.
  • UK chargeable gains on UK property disposals: outside FIG. UK situs under TCGA 1992; taxable in normal UK CGT (or NRCGT pre-arrival) regardless of FIG status. The 5 April 2017 rebasing election (below) does not apply to UK property.
  • Foreign dividend income and foreign interest: inside FIG.
  • UK source dividend and interest: outside FIG.

The split is critical for property investors with cross-border portfolios. The arithmetic for Anika (covered in the worked example below) shows the FIG cover saving meaningful tax on her Mumbai rental portfolio while the London BTL contribution to her UK tax bill runs as for any UK-resident landlord.

The Temporary Repatriation Facility: 12% / 12% / 15%

The TRF is the transitional bridge for individuals who built up untaxed foreign income or gains during pre-April-2025 remittance-basis years and now face a choice between leaving the money offshore indefinitely or paying full-rate UK tax to bring it onshore. The facility allows the individual to designate pre-6-April-2025 foreign income and gains (including amounts in offshore mixed-fund bank accounts) and pay a concessional rate of UK tax on the designated amount. Once designated and the rate paid, the underlying amount is treated as taxed and free to be remitted to the UK without further UK tax.

Rate schedule (the headline mechanic):

  • Designations made in 2025/26: 12%.
  • Designations made in 2026/27: 12%.
  • Designations made in 2027/28: 15% (added by the Autumn Budget 2024 extension; the original Spring Budget 2024 announcement was a two-year facility at 12%, then extended to three years with the third year at the higher 15% rate).

For a remittance-basis user with (say) £500,000 of unrepatriated foreign rental income accumulated 2015/16 to 2024/25, the TRF arithmetic is straightforward: designating in 2025/26 or 2026/27 costs £60,000 (12% on £500,000) and the £440,000 net is available to use in the UK without further UK tax. Without the TRF, remitting the same £500,000 post-April-2025 would charge it at the user's marginal income tax rate (typically 45% for HNW remittance-basis users), costing £225,000 in UK tax. The TRF is worth a £165,000 saving against the full-rate cost; the question is whether the individual needs the cash in the UK at all (if the funds will sit offshore indefinitely, designating and paying the 12% has no benefit).

The TRF interacts with the FIG regime for individuals who were remittance-basis users pre-April-2025 and qualify for FIG from April-2025 onwards (rare; almost all FIG-eligible new arrivals are NEW arrivals, not existing residents). For the typical user, the TRF applies to pre-April-2025 amounts and FIG applies to post-April-2025 amounts; the two operate on different time-windows.

The 5 April 2017 CGT rebasing election

Individuals who claimed the remittance basis in any tax year between 2017/18 and 2024/25 may elect to rebase the cost of qualifying foreign-situs assets to their market value on 5 April 2017. The election is asset-by-asset. The mechanic:

  • Foreign-situs asset acquired pre-5-April-2017, held throughout, and the individual was a remittance-basis user in the relevant lookback years: election available, rebases the asset to its 5 April 2017 market value.
  • On later disposal, only the gain from 5 April 2017 onwards is chargeable UK CGT.
  • Pre-5-April-2017 gain is effectively washed out (the rebasing pushes the cost up to the 5 April 2017 value).

The election is most valuable for foreign property and foreign shares with material pre-2017 appreciation. For a foreign property bought in (say) 2010 for £200,000, worth £450,000 at 5 April 2017 and £600,000 at disposal in 2027: pre-election gain is £400,000 (£600,000 less £200,000); post-election gain is £150,000 (£600,000 less £450,000). At 24% residential rate the election saves £60,000 of UK CGT on the disposal, against zero election cost.

The election does NOT apply to UK property. UK residential property is already within NRCGT from 6 April 2015 (default rebasing to 5 April 2015) and UK non-residential land and indirect disposals are within NRCGT from 6 April 2019 (default rebasing to 5 April 2019). An ex-remittance-basis user holding both UK and foreign property runs UK property through the NRCGT-or-post-arrival-UK-CGT machinery and foreign property through the FIG/TRF/rebasing framework.

Worked example: Anika, Mumbai-born surgeon arriving in the UK September 2026

Anika, 42, Indian national, consultant cardiologist. She has been resident in India her entire adult life (no UK residence in any of the past 10 tax years: lookback clear). She accepts an NHS consultant post in Manchester starting 1 September 2026, on a Skilled Worker visa. She owns three Mumbai rental properties producing combined gross rent of INR 18,00,000 per year (approximately £17,000), held in her own name. She also bought a London BTL in 2024 (purchase £350,000, current value £370,000) as a UK investment, producing £18,000 gross UK rent.

FIG eligibility 2026/27. Anika became UK tax resident under the SRT from 1 September 2026 (split-year Case 4 likely: starting to have only a UK home). She has zero UK tax residence in the 10-year lookback. She qualifies for FIG from 2026/27 (her first qualifying UK year).

FIG election for 2026/27 (split-year arrival year):

  • Foreign-source: Mumbai rental income (approximately £17,000 gross, roughly £10,000 net after Indian allowable expenses and Indian tax). FIG cover, no UK tax in this year.
  • UK-source: London BTL rental income, £18,000 gross. Under section 264 ITTOIA 2005, UK source, NOT covered by FIG.
  • UK employment income (NHS salary from September 2026), £85,000 annualised, around £53,000 for the seven months, taxable on the arising basis as UK source.
  • Cost of FIG election: surrender of £12,570 personal allowance for 2026/27, surrender of £3,000 CGT AEA for 2026/27. Surrender cost in 2026/27 tax terms: roughly £5,000 (personal allowance at 40% her marginal rate, plus AEA surrender having no immediate effect because she has no UK CGT in the year).
  • FIG benefit in 2026/27: approximately £4,000 of UK income tax saved on the Mumbai rental net £10,000 (at her marginal rate after non-FIG arithmetic; rough approximation accounting for the personal allowance surrender).
  • Net benefit of FIG election in 2026/27: marginal at best. The Mumbai portfolio is too small for FIG to comfortably outweigh the personal-allowance surrender.

Conclusion: Anika may rationally choose NOT to elect FIG in 2026/27 because her Mumbai rental income is below the threshold where surrendering the personal allowance pays for itself. She elects FIG only in years when her foreign income materially exceeds the surrender cost.

2030/31 (year 5, FIG window has closed). Anika is now in year 5 of UK residence. FIG no longer available. Her Mumbai rental income is taxable on the arising basis in the UK, with foreign tax credit relief for Indian tax paid under the UK-India 1993 Double Tax Convention (Article 6 immovable property, Article 24 elimination of double tax by credit method). UK tax on the Mumbai rental: roughly £4,000 at her marginal rate; less Indian tax credit of (say) £2,000; net UK tax on Mumbai rental £2,000. Her UK rental from the London BTL continues as normal UK landlord arithmetic.

Disposal of one Mumbai flat in 2032/33. Foreign-situs gain. If Anika had been a remittance-basis user in 2017/18 to 2024/25 the rebasing election would apply; but she was not UK resident in those years, so the rebasing election is not available to her (she is a NEW arrival, not an ex-remittance-basis user). Gain on the disposal: foreign-situs, UK CGT applies on the full gain from acquisition to disposal (no rebasing relief available), with foreign tax credit for Indian CGT paid. If she had been remittance-basis pre-2017, the rebasing would have applied; the FIG/rebasing distinction is important.

Property-investor misconceptions corrected

"FIG means my UK rental income is exempt for four years." Wrong. FIG covers foreign source only. UK rental income from UK property is UK source under section 264 ITTOIA 2005 and is taxable in the UK on the arising basis regardless of FIG status. The London BTL of an FIG-claiming inbound investor pays UK income tax in full.

"The TRF runs for two years." Outdated. The original Spring Budget 2024 announcement set the TRF as a two-year facility at 12%. The Autumn Budget 2024 (delivered 30 October 2024 by the new Labour government) extended the TRF to a third year at 15%. Current schedule: 12% in 2025/26, 12% in 2026/27, 15% in 2027/28. Sources published before the Autumn Budget 2024 may still describe the original two-year design.

"FIG applies to anyone arriving in the UK from abroad." Wrong. FIG requires 10 consecutive tax years of non-UK residence preceding the first qualifying year. Returning Britons with any UK residence year in the 10-year lookback are disqualified until the lookback clears. A single UK-resident year in the lookback (often from accidental SRT residence during what was assumed to be a clean overseas spell) breaks the chain.

"The 5 April 2017 rebasing election rebases my UK property." Wrong. The election applies only to foreign-situs assets. UK property runs through NRCGT (rebasing to 5 April 2015 residential / 5 April 2019 non-residential) for non-resident disposals or normal UK CGT for resident disposals. The non-dom rebasing is a separate mechanic.

"The TRF is a CGT instrument, not income tax." Wrong. The TRF applies to both pre-April-2025 foreign income and foreign chargeable gains, plus amounts held in mixed-fund offshore bank accounts. Designation is made on the tax return with the 12% or 15% rate (depending on year) on the designated amount, whether the underlying source is income or gain.

"FIG election removes the need to file UK self-assessment." Wrong. The FIG election is made on the annual SA100 / SA109 self-assessment return. UK source income remains on the return and remains taxable. Foreign income and gains are reported on the return but not subject to UK tax in qualifying years. The election does not reduce filing obligations; it changes only the tax outcome for foreign source amounts.

"After 4 years of FIG I can move offshore again and restart the 4-year window on return." Wrong. The 10-year lookback is fresh on each FIG claim. To re-qualify for a new four-year window, an individual must have 10 consecutive tax years of non-UK residence preceding the new qualifying year. A four-year FIG period followed by three years offshore does not restart the window; the lookback is broken by the four FIG years.

Sequencing for new arrivals and existing non-doms

New inbound investor (no prior UK residence in past 10 years). First, run the 10-tax-year SRT lookback verification to confirm FIG eligibility. Second, value foreign assets at acquisition date (no special acquisition rebasing needed; the FIG window simply shields the foreign income/gains for four years, no rebasing required). Third, plan the FIG election year-by-year against the personal-allowance surrender cost. Fourth, model the year-5 transition: at the end of the four-year window, foreign income enters UK tax on the arising basis, often necessitating restructuring of foreign assets before the window closes. The companion SRT decision tree page covers the residence-test mechanics for the year of arrival, and the split-year treatment guide covers the Case 4 / 6 / 8 arrival cases.

Existing remittance-basis user (UK resident pre-6-April-2025). First, take stock of accumulated pre-April-2025 foreign income and gains (the TRF designable amounts). Second, decide which amounts to designate and in which TRF year (12% versus 15% schedule against the timing of intended UK remittance). Third, identify foreign-situs assets eligible for the 5 April 2017 CGT rebasing election (asset-by-asset valuation at 5 April 2017). Fourth, plan post-April-2025 foreign income on the arising basis (no FIG cover, since the existing user does not meet the 10-year non-residence test) with foreign tax credit for any foreign tax paid.

Inheritance tax planning across both cohorts. Under the residence-based IHT regime, long-term residence (10 of 20 tax years, or 10 consecutive) brings worldwide assets into UK IHT scope. A new arrival has a 10-year runway before worldwide IHT applies; an existing long-term resident is already within scope. The April 2025 IHT residence test page covers the mechanics in full; the planning question for property investors is whether to hold foreign property through structures that retain non-UK situs (no longer protected by domicile, only by genuine non-UK situs of the underlying asset).

The April 2025 reform is more nuanced than the headline "non-doms abolished" framing suggests. For property investors specifically, FIG is the inbound-arrival shield (with material caveats on the 10-year lookback and the personal-allowance surrender), the TRF is the bridge for legacy remittance-basis users with offshore accumulations, and the 5 April 2017 rebasing is the disposal-timing instrument for foreign-situs assets with material pre-2017 appreciation. UK property runs on its own UK-tax track regardless of which of the three instruments the investor uses elsewhere.