A four-year tax window

The spear Tax expert Top Flight Robert Brodrickpartner in Payne Hicks Beach private client department, described the four-year window as “incredibly generous”.

“We went from one extreme to the other,” he explains. “For four years it’s a very attractive arrangement, but then it becomes unnecessarily harsh.”

(See also: Where have all the British billionaires gone?)

These four years – which coincidentally coincide with the time in office of a US president – ​​create a window for people who, for personal or political reasons, wish to temporarily leave their home country.

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As a result, the UK could become a “tax haven” for those seeking a politically stable environment in these difficult times.

James Frampton, private wealth associate at Michelmoressays it has seen a surge in interest from US customers and British expats in the US following the recent election.

“There has been an increase in inquiries from customers considering returning to the UK due to concerns about another Trump administration,” he says.

Cultural ties, common language and political stability make the UK an attractive option for Americans and returning British expats seeking a more predictable environment.

And after the Budget there are further incentives, with Frampton acknowledging that “British expats and US citizens considering moving to the UK following Trump’s victory will benefit from changes to the UK’s income and benefits regime.” gains”.

Who would benefit from the new UK tax regime?

The policy only applies to those who have not resided in the UK in the last decade, which could include many HNWs around the world.

“It does seem like there are two categories of people who are really going to benefit from this,” notes Brodrick. “One of them is people who won’t be happy living in the US under Trump, for example. They can come to the UK, stay there for four years without being taxed on foreign income, then potentially to come back.

(See also: British billionaire and entrepreneur James Dyson calls out ‘malicious’ Rachel Reeves inheritance tax raid)

High net worth individuals who move to the UK will still be taxed in the US, but will not face additional tax burdens on their foreign income while in the UK.

Another group likely to find this policy attractive includes those in residency-based tax jurisdictions outside the United States, where taxes are determined based on residency rather than overall income. “They can use the UK as a base to sell their business tax-free,” says Brodrick, referring to how some non-US based business owners could temporarily relocate, avoiding taxes on significant transactions while in the UK.

This new regime could also benefit descendants of wealthy non-residents who hold family trusts, Brodrick believes.

“For children and grandchildren of wealthy people living in established structures, this is very helpful. They can come to the UK as beneficiaries of a trust and stay there for four years tax-free.

Then they will only be taxed on income directly received from the trust, while the overall inheritance remains outside the scope of UK tax.

A “friendly invasion” of rich Americans?

With these changes, the UK is positioning itself as a more flexible and tax-friendly environment, likely to attract an influx of affluent expats, particularly those concerned about the direction of US politics.

Brodrick remains cautiously optimistic: “I hope people don’t abuse the system, but I think the UK could be a very attractive place, even for four years.”

(See also: From capital gains to inheritance tax, what the budget means for Britain’s rich)

The government seems to be banking on the wealthy

s bring significant wealth to the country, spend on real estate, hire staff and enroll children in British schools (And pay VAT on fees starting in January, as Brodrick notes).

As Brodrick suggests: “Even if they don’t pay as much tax, they still contribute to the local economy in a way that the government hopes will make up for the loss of taxes on foreign income.” »