Non-domicile status doesn’t exist in UK tax law anymore. The UK moved to a residence-based system on 6 April 2025, and the practical effects go beyond what most of the coverage at the time actually captured. For a foreign national, or a UK resident holding assets and income abroad, thinking about a UK property purchase, the useful exercise is separating what actually moved from what stayed exactly where it was, and Expat Mortgages UK is well placed to help with the mortgage side of that decision.
What Replaced Non-Dom Status
The old rules let someone who was UK resident but domiciled elsewhere shelter their foreign income and gains from UK tax, provided that money stayed outside the UK. That option no longer exists. In its place is the Foreign Income and Gains (FIG) regime, and it works differently.
Anyone arriving in the UK after at least ten years of non-UK residence gets a four-year window in which foreign income and gains, including distributions from non-resident trusts, can be brought into the UK without a UK tax charge. There’s a trade-off: claiming this treatment means giving up the income tax personal allowance and the capital gains tax annual exempt amount for that year. Once the four years are up, the picture changes completely. From that point on, worldwide income and gains are taxed under the ordinary rules that apply to any UK resident, whether or not the money ever touches a UK bank account.
UK Property: What Actually Changed
Here’s the part that gets misunderstood most often: UK residential property was never sheltered from UK inheritance tax by non-dom status, and that hasn’t changed under the new rules either. A non-dom buying a house or flat in the UK has always been, and remains, within the scope of UK inheritance tax on that specific asset. The FIG regime affects foreign income and gains and certain trust structures; it was never the thing standing between a non-dom’s UK property and UK tax.
Capital gains tax on the sale of UK residential property also sits outside this reform. Basic-rate taxpayers pay 18% and higher-rate taxpayers pay 24% on a gain, rates that have applied since April 2024 and weren’t touched by the non-dom changes. The legal process of actually buying the property hasn’t changed either — our guide to the legal side of buying UK property as an expat covers exchange, completion and the rest of that separately.
Inheritance Tax: A New Test
The real shift sits in how the inheritance tax net gets drawn around someone’s worldwide estate. Domicile used to decide that question, and it was a notoriously slippery concept to pin down or shed. Residence decides it now: spend ten of the last twenty UK tax years living in the UK and your whole worldwide estate, not just what you hold here, falls within UK inheritance tax. Moving abroad afterward doesn’t switch that off straight away. A tail period of three to ten years follows you out, with the exact length set by how long you were resident.
The Autumn 2025 Budget didn’t touch the core FIG regime, though it did walk back an earlier, harsher proposal for one specific structure. Excluded property trusts, a vehicle some non-doms used to hold assets outside the UK, now face a £5 million cap on inheritance tax charges in any ten-year period, instead of the wider exposure first floated. Anyone already running a trust structure needs to know that; a straightforward home or investment purchase in the UK isn’t affected by it at all.
What This Means If You’re Buying
A mortgage application gets assessed the same way regardless of any of this. Lenders look at income, deposit, credit history and their own criteria, and your domicile or residence status doesn’t enter into that calculation. What these rules actually touch is what it costs you to hold UK property year to year, and for some buyers, the estate and tax planning that sits around it, neither of which a mortgage broker is qualified to advise on.
That’s why the mortgage and the tax planning are best kept as two separate conversations, each with the right specialist. A broker who deals with expats and foreign nationals routinely can help you find the right lender for your situation and put together a mortgage that fits. Working out what the FIG regime and inheritance tax exposure actually mean for your own circumstances, though, belongs with a qualified UK tax adviser, ideally someone who regularly handles non-UK residents and former non-doms.
Working with the right people on both fronts means you can make a property decision based on the full picture, not just the parts that happen to be easy to research yourself.
Frequently Asked Questions
Does the end of non-dom status affect my ability to get a UK mortgage?
No, not directly. A lender looks at your income, deposit, credit history and its own criteria, not your domicile or tax residence status, when assessing affordability. Your tax position becomes relevant afterward, in what it costs you to hold the property year to year and in any estate planning you do around it, and that’s a separate conversation from arranging the mortgage.
I'm a non-dom buying UK property. Does the FIG regime mean I'll pay more inheritance tax on it than before?
Not on the property itself. UK residential property has always fallen within UK inheritance tax regardless of domicile status, so that part hasn’t changed. What’s different is how the rest of your worldwide estate is treated: residence, not domicile, now decides whether your other assets are also brought into scope.
What is the Foreign Income and Gains regime, in simple terms?
It’s the replacement for the old non-dom remittance basis. If you move to the UK after at least ten years of living abroad, you get four years in which foreign income and gains can be brought into the UK tax-free, though you give up your personal allowance and capital gains annual exempt amount while claiming it. After four years, you’re taxed on worldwide income and gains like any other UK resident.
Has capital gains tax on selling UK property changed under these reforms?
It hasn’t changed. Basic-rate taxpayers still pay 18% and higher-rate taxpayers 24% on residential property gains, the same rates that have been in place since April 2024, well before the non-dom reforms and untouched by them.
How long do I need to be UK resident before my worldwide estate is exposed to UK inheritance tax?
Ten out of the last twenty UK tax years as a resident brings your whole worldwide estate into scope, not just what’s based here. Leaving the UK doesn’t end that exposure straight away either: a further three to ten years can still apply depending on how long you were resident, so plan the timing with a tax adviser instead of assuming the clock stops the day you go.
Should I speak to my mortgage broker or a tax adviser about how these rules affect me?
Both, though for different reasons. Your broker’s job is finding the right lender and putting the mortgage together. Working out how the FIG regime, the inheritance tax residence test, or any trust structures apply to your own circumstances needs a qualified UK tax adviser, ideally one who’s experienced with non-UK residents and former non-doms.
Final Thoughts
Expat Mortgages UK is a specialist broker directly authorised and regulated by the Financial Conduct Authority. We work exclusively with expats and foreign nationals buying UK property with overseas income. Your home may be repossessed if you do not keep up repayments on your mortgage.
Call us on +44 1494 622 555 or email info@expatmortgages-uk.com to speak to a specialist directly.