On April 6, 2025, Sir Keir Rodney Starmer, Prime Minister of the UK Labour Government, made some changes in the UK non dom tax regime, which has forced a large number of wealthy individuals, especially company directors, to leave the UK and seek other investment options. According to the changes made, the residents of the UK who have domiciled status have to pay taxes on the income they earn outside the UK and their assets. This has increased the UK wealth exodus as the departure rate from the UK has increased a lot compared to previous years.
UK Non Dom Tax Changes
The resident UK non dom tax regime (RND), which was imposed for the past 200 years, allowed wealthy individuals and company directors whose permanent homes were outside the Kingdom to not pay taxes on foreign income and capital gains. The residents of the UK only had to pay taxes on the income earned inside the country. This helped the investors to save money and manage their expenses efficiently.
But in April 2025, the UK non dom tax regime was replaced with a new foreign income and gains (FIG) regime. This new FIG regime affected the wealthy individuals because now the residents who had been outside the UK for 10 years, also known as qualifying new residents (QNRs), could only benefit from the non dom tax regime, and this too only for the first four years. However, if the QNRs consider living in the UK after those 4 years, then they also have to pay taxes on worldwide income and capital gains. This provided a little relief to the investors but only for the first four years, hence forcing more individuals to still seek better investment options.
Surge in UK Millionaire Exodus
After the changes made in the non dom tax regime, around 4000 company directors left the UK and moved to other lower-tax countries like the UAE, Italy, and Spain. According to the analysis made by Financial Times on the data from Companies House, an executive agency that registers companies in the United Kingdom, 3790 directors have started living abroad from October 2024 and July 2025. However, in 2023, during the same period, the number of people leaving was 2,712. This shows that the departures have increased by 40% from the previous year.
Mark Makepeace (Chief Executive of FTSE Russell), Bart Becht (Former CEO of Reckitt Benckiser), Riccardo Silva (Owner of Silva International Investments), Edward John Hearn (a British Sports Promoter), and John Reece (Chief Financial Officer of Inneos) are among the popular names who have left the UK since the Autumn Budget has been announced.
According to Bloomberg News, the reports of departures claim that around 691 company directors have left the UK in April 2025, which is 79% more than in April 2024, and 104% more than in April 2023.
Top Destinations for UK Millionaires
London, once known as the Financial Capital of Europe, is now losing its charm due to ongoing surges in tax rates. The city is now the 6th wealthiest city in the world, slipped from 5th spot. Nowadays, UK millionaires and wealthy directors prefer countries with low tax rates. Therefore, after the changes in tax policies of the UK, small and medium-sized business owners considered Portugal and the United Arab Emirates as the top destinations for relocation, considering the favorable tax policies.
According to a report, around 150 UK-based company directors moved to the UAE between April and June of 2025. Some of the people, when asked about their reason to leave the UK, answered that the investment in the UK has become very risky and less stable for them, thus they are moving to countries like the UAE via Dubai Golden Visa that offer attractive tax benefits and a better environment to its foreign investors.
After the UAE, Portugal, Spain, and Italy became the second, third, and fourth most popular destinations among UK business owners, respectively. A British private equity manager who left the UK and moved to Italy said, “The UK is no longer as attractive to wealth creators as it once was, and there are other countries that offer better incentives.“
Experts Warn on UK Wealth Exodus
Jimmy Sexton, the founder and CEO of Esquire Group, said these changes in the tax regime are negatively impacting the country. He said almost all of his clients who had non-domiciled status have left the United Kingdom. People also show a lack of interest in the UK self sponsorship route, which was once the top favorite among investors. He also said the UK has lost a large number of wealthy individuals who were effectively contributing to its economy by generating a considerable Value-Added Tax (VAT) Revenue.
According to an estimate by the Office for Budget Responsibility(OBR), an independent body that analyzes public finances of the UK, the changes made in the non-dom tax regime will generate around 33.8 billion pounds in the coming five years. However, the amount claimed is uncertain as it depends on the small number of wealthy individuals who are remaining in the UK.
Sexton further warned the government about the consequences it might face if they introduce a wealth tax in the Autumn Budget. He said, “If that passes, you will see an even bigger UK wealthy exodus.”
How UK Inheritance Tax Adds to Wealthy Exodus?
Apart from changes made in non dom tax regimes, UK inheritance tax is putting further pressure on wealthy individuals to leave the UK and move to countries with low or no inheritance tax. According to UK inheritance tax law, the wealthy individuals who have an estate or property worth above £325,000 have to pay 40% of inheritance tax on the part of the property which is above the threshold. This is negatively affecting the high-profile businessmen, entrepreneurs, property owners, and remote workers with high-paying jobs whose property prices surpass the given threshold due to increasing property prices.
Portugal D Type Visas Attract Wealthy Investors
Portugal D type visas have become a popular choice for foreign investors who are leaving the UK and seeking other investment options. The D type visas provide foreign investors a pathway to Portugal residency with a stay of over 3 months. These D type visas including, D2 visa, which is especially for entrepreneurs, the D7 visa, which is beneficial for people who want to live in Europe after retirement, and the D8 visa, which allows remote workers to expand their businesses, are attracting a large amount of wealthy investors who want to live and work in Europe.
By investing in Portugal D type visas, the investors can benefit from its Non-Habitual (NHR) tax regime and permanent residency and citizenship in Portugal; thus making it a valuable option for the wealthy investors of the UK who are deciding to leave the UK and seeking residency in countries with better opportunities.