Is domicile dead?

The UK tax landscape is undergoing one of its most significant shifts in decades. Since April 2025, the concept of domicile — long a cornerstone of the UK’s tax system — has effectively been abolished looking forward for tax purposes. In its place, a new regime based on residence has taken over, reshaping how rules on foreign income, gains, and inheritance tax (IHT) are applied to individuals with international ties.

But does this mean domicile is truly dead? Not quite.

The end of domicile for tax purposes

The UK has scrapped the remittance basis, under which formerly non-domiciled individuals only incurred UK tax on foreign income and gains when the assets were remitted to the UK. Under the new rules, all UK-resident taxpayers will be taxed on foreign income and gains on an arising basis, regardless of domicile or where the assets are located.

There are transitional measures in place, including the Foreign Income and Gains (FIG) regime and the Temporary Repatriation Facility (TRF), which may provide useful planning opportunities if correctly implemented (depending on individual circumstances).

UK IHT has also shifted to a residence-based system. IHT will be charged if the deceased had been UK resident for 10 out of the previous 20 tax years immediately before their death. A person will remain within scope for UK IHT for up to ten years after leaving the UK. This marks a decisive move away from the domicile-based IHT regime.

Domicile still matters—especially in Scotland

While tax law is changing, domicile remains key, particularly in areas outside HMRC’s remit. In Scotland, domicile is still relevant for succession rights, the distribution of estates on intestacy, and family law matters.

Unlike in England, Scottish law provides for forced heirship rules called legal rights – applicable for spouses and children that apply irrespective of the terms of any will. The existence of these rights depends on the deceased’s domicile at the date of their death. If the deceased died domiciled in Scotland, legal rights will apply.

Domicile also continues to be a relevant factor in Scotland in relation to relationship breakdowns and disputes involving children.

So, even if HMRC no longer cares where you are domiciled, your heirs, your family and the Scottish courts certainly might.

Cross-border estates and double tax treaties

Domicile will still play a crucial role in international estate planning, especially under double tax treaties. The UK has estate tax treaties with several countries, including the United States, which rely on domicile to determine taxing rights, reliefs and avoid double taxation.

For example, under the UK-US estate tax treaty, domicile is a key factor in determining which country has primary taxing rights in relation to a deceased’s estate.

What should you do?

Review your estate plan: If you have international connections or assets, revisit your will, power of attorney and succession arrangements to make sure your plans are still right for you.

Take advice on the new rules: If you are a new, existing or returning UK resident, you should seek professional advice on the application of the new rules to your circumstances.

Domicile isn’t dead — it’s just evolving

While the UK tax system is moving on from domicile, the concept is far from dead. Domicile remains key for succession, estate planning, and family law. For advisers and individuals alike, understanding where domicile still matters — and where it no longer does — is essential in navigating this new era and in ensuring the correct documents are in place. For more information, please get in touch with on of our wills and estate planning experts.