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The possibility of an exodus of non-domiciled taxpayers has been exaggerated, a new study suggests.
A survey commissioned by Barclays Wealth, a wealth management service, claims that recent legislative changes have altered the non-domiciled's attitudes to the UK, but overall they recognise that it remains the best place in the world for people of their tax status to be.
The research, which was carried out by wealth management strategists Scorpio Partnership, sought the views of leading advisers to UK non-domiciled taxpayers, including five leading private client accountants and 11 leading law firms (which between them are estimated to have advised at least 50% of the country's non-domiciled population).
Reasons for the UK's continued appeal were varied, and were given as:
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City workers and professionals are here because of their employment and professional opportunities are hard to duplicate.
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The majority of the non-domiciled community have adapted quickly to the fixed charge concept introduced in this year's Budget.
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Non-domiciled are unwilling to leave the UK solely for tax reasons. There are more practical considerations to be taken into account, including the education of children, culture and London's general appeal.
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Advisers are still recommending that, from a purely financial perspective, the UK remains, on balance, one of the best places in the world to be non-domiciled.
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London retains a critical mass of hedge fund managers and financiers (but they have a 'domino mentality', meaning the situation could change rapidly if only a small proportion of non-doms elect to leave).
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Current uncertainties in the UK property market mean members of the community are anxious not to sell up at a time when the best prices might not be achieved on what they consider to be long-term investments.
The findings follow an announcement last week by the House of Lords economic affairs sub-committee, which said that alterations to residence and domicile laws have been poorly communicated and are likely to have a negative effect on the nation's competitiveness.
Barclays Wealth Intermediaries MD Peter Horrell commented on his company's new document: 'The advisory community… has shown that it is evidently on top of the impact of the changes and is well placed to make suitable response recommendations to those wishing to retain [non-domiciled] status.
He added: 'The decision process for non-domicile international professionals is more complex than previously, as they now have to think a little harder about whether to move to, or remain in, the UK — but once they have clarity on the impact of these changes and how they affect them, they are able to realise the many other benefits of living in the UK.'
