UK residents who are non-domiciled, who currently pay £4bn in UK tax on UK earnings, will now also have to pay an annual charge of GBP30,000 to ensure
that they contribute in respect of the foreign income and gains which they keep abroad and on which they do not pay UK tax. The charge will apply if they’ve been resident here for more than 7 years. Users of the remittance basis also lose their tax free personal allowances.

The Government says the measure is targeted to protect competitiveness by ensuring that secondees to the City are not affected (the majority have left the UK by 7 years). The Government says it will also amend the current rules to remove flaws and anomalies that allow remittance basis users to sidestep UK tax where it is due
on foreign income and gains. It will also tighten up the day counting rules to bring the UK into line with international practice.

The new 'non-dom' rules will also end discrimination that has prevented Irish people resident in the UK enjoying the same tax relief as other foreign nationals.

Paula Tallon, head of direct tax at tax advisers Chiltern, said: "This puts Irish nationals living in Britain on the same footing as other foreigners. It means they will only be taxed on Irish source income if remitted to the UK. It is about time this inconsistency is removed. It's great news for Irish people."