The UK government is reportedly considering a 20% tax on assets for wealthy individuals who decide to leave the country. The move, described as a “settling-up charge,” could generate around £2 billion for public finances and would align Britain with most other G7 nations.
Currently, expats pay 20% capital gains tax on the sale of UK property and land valued at £6,000 or more. However, other assets, including shares in many companies, are exempt once individuals move abroad. Under the new plans, the 20% charge would apply to these assets at the time of exit.
A government source confirmed that the Treasury is modeling several tax options ahead of the next budget but stressed that no decisions have yet been made. Experts note that without such a tax, the UK remains an “outlier” among developed nations.
James Smith, research director at the Resolution Foundation thinktank, said the tax would target individuals relocating to low-tax jurisdictions. “They would have to pay tax on asset gains, like shareholdings, that remain in the UK,” he explained. “At present, someone moving to Dubai could sell UK assets after leaving and avoid UK capital gains tax.”
Officials are reportedly exploring ways to implement the charge immediately to prevent capital flight. The scheme could allow individuals to defer payment for several years if they choose not to sell assets right away.
Tax experts also suggest combining the plan with a policy exempting capital gains earned before moving to the UK. This would ensure a “fair and symmetrical” tax treatment while potentially attracting investors to relocate to Britain.
The Treasury has declined to comment on the reports. Analysts say that if introduced, the settling-up charge could reshape decisions among wealthy UK residents and influence broader economic trends, including investment and relocation strategies.
