Non-dom changes encourage business investment

The Treasury has today confirmed that the reforms to the taxation of non-UK domiciled individuals announced earlier this year will go ahead. One such reform means that from 6 April 2012 non-doms will be able to remit their overseas income or capital gains to the UK tax-free, where they do so for the purposes of making a ‘qualifying investment’. A ‘qualifying investment’ is an investment in unlisted companies, or those listed on exchange regulated markets, which carry out trading activity on a commercial basis or undertake the development or letting of commercial property. There will be specific anti-avoidance provisions to ensure the investment is made on proper commercial terms.

We welcome this investment opportunity for non-doms. The current rules have discouraged many entrepreneurial non-doms from bringing money from overseas to invest in UK businesses. The rules are tightly drafted, and rightly so. There will be a number of hoops to jump through, but non-doms investing in genuine commercial businesses will benefit from April.