4 days ago
The global tax game: How UAE is winning while London forgets its own playbook
In any game, it's not just how you play — but how others play — that can work to your advantage. This perfectly captures the ongoing shift in global tax dynamics, particularly in the United Kingdom.
According to the 2024 Global Migration Report, over 9,500 high-net-worth individuals (HNWIs) have exited the UK — a number that is only expected to grow. One of the most significant catalysts for this exodus is the upcoming overhaul of the UK's non-domiciled (non-dom) tax regime, effective 6 April 2025.
Let's break down what's changing—and why the UAE stands to gain the most.
What Was the Non-Dom Regime?
Until 5 April 2025, UK residents who were classified as non-domiciled could benefit from the remittance basis of taxation. This meant:
They were only taxed on foreign income and gains (FIG) if these were brought into (remitted to) the UK.
This allowed wealthy individuals to accumulate global income offshore without facing UK tax obligations - so long as they kept the money abroad.
This system made the UK attractive to wealthy foreigners. But the landscape is about to shift.
What's Changing from 6 April 2025?
The UK government is abolishing the concept of domicile as a key factor in taxation and replacing it with a residence-based system. The key changes include:
End of the Remittance Basis: All UK tax residents will be taxed on their worldwide income and gains, regardless of domicile status, after a transitional period.
Transitional Relief:
o For 2025–2026, only 50% of foreign income will be taxed if switching
from the old to the new system.
o A special 12% tax rate applies to foreign income earned before 6 April
2025 if remitted in the 2025–26 or 2026–27 tax years.
Ultimately, after four years of UK tax residence, individuals will be taxed like any other UK resident—with no FIG exemptions.
Who will this impact the most?
These changes primarily affect HNWIs and global families who historically relied on the non-dom regime to protect their offshore wealth from UK taxation. The shift not only undermines long-standing tax planning structures but also reduces the UK's appeal as a global hub for mobile capital and top-tier talent.
How the UAE stands to gain
As capital chases efficiency, tax policy plays a decisive role in location selection. The UAE, with its 0% personal income tax regime, robust financial infrastructure, and world-class quality of life, emerges as a natural haven.
Here's why the UAE is poised to gain the most:
Strategic location: Needless to mention not just close to Europe - but at the
crossroads of East and West, connecting global markets with ease.
Stability and predictability: In a rapidly changing tax world, the UAE offers clarity, consistency, and long-term visibility for individuals and families. With a bold vision and cautious implementation of compliances, it emerges
as a strong contender.
Transparent and rules-based Golden Visa regime: Unlike jurisdictions
such as Singapore - where the PR process is often seen as opaque and discretionary- the UAE has published its Golden Visa rules in black and white, creating a rules-based and inclusive system that welcomes both wealth and talent.
Limited competition: With Hong Kong effectively out of the race due to political and regulatory concerns, and while traditionally leading in the race, Singapore, it's PR regime becoming increasingly restrictive, the UAE is among the very few jurisdictions offering competitive, clear, and welcoming advantages.
The bigger picture: The global tax game
The UK's tax reform is part of a larger pattern: nations are rewriting tax codes to balance fairness, revenue, and global competitiveness. But when one jurisdiction tightens its rules, others gain ground.
For the UAE, this is not just a short-term win - it's a long-term opportunity to attract global talent and wealth.
Follow us for more insights in our series: The Global Tax Game —where we explore how countries are competing to attract capital through smarter tax policies.
