US expats can't escape their taxman. Could broke Britain follow suit?
But what happens if fleeing the country doesn't take you out of the taxman's tentacles? For US nationals and anyone who has lived there for a number of years, the reach of the tax collector knows no borders.
Take US national and UK resident Sebastian. Even though the 33-year-old (who didn't want to use his surname) left Los Angeles three years ago for a marketing job in London, he must still file a US tax return that is technically due on April 15 every year.
'I don't necessarily have to pay tax. I just have to report it,' he says. 'Last year I paid someone to do my tax returns because it's just way too complicated. This year I'll try a third-party software.'
As the list of rich people fleeing the UK grows – and the Chancellor stares down a black hole of up to £50bn in the public finances – a US-style citizens tax to solve Britain's fiscal crisis and stop people from migrating is taking on greater appeal.
Treasury officials have previously floated the idea of a levy on Britons who move away but keep a British passport. The Tories also toyed with an exit tax when they overhauled the non-dom regime.
'It was never pursued any further, though,' says a Tory source. Another calls a US-style citizenship tax for Britons abroad the 'magic grandpa plan'. Labour sources declined to comment on any plans.
The UK has never imposed a tax system like this before – could it prove an alternative to hammering the rich?
'Once you're a US citizen, you're in the club'
FT analysis found 3,800 company directors left the UK in the last year – up by more than 1,000 from the previous year, with the United Arab Emirates the most popular destination.
Bloomberg research of five million company filings put the figure at 4,400 in the year to April, with a spike leading up to the end of the tax year.
It includes a long list of both British and overseas nationals – such as Mark Makepeace, the founder of FTSE Russell; Riccardo Silva, the owner of Miami Football Club; and Nassef Sawiris, Egypt's richest man.
Because they no longer reside in Britain, they no longer personally pay UK tax. But that's not the case for Americans.
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