The inheritance tax shake-up that is shaking up the City
Chancellor Rachel Reeves is facing growing pressure to reverse recent tax reforms targeting non-domiciled individuals, after a wave of wealthy investors began shifting their money and residency abroad. The Treasury is now reviewing the changes, particularly the extension of inheritance tax on worldwide assets… as concerns grow over the UK’s global competitiveness.
If you or your clients hold overseas assets or rely on property reliefs, now is the time to pay attention.
Why are non-doms leaving the UK?
From April 2025, the Government made all worldwide assets held by non-domiciled individuals subject to the UK’s 40 percent inheritance tax. This marked a major departure from the previous regime, which allowed certain exemptions through offshore trusts and property reliefs.
High-profile business figures including Lakshmi Mittal and Nassef Sawiris have already relocated or are planning to leave the UK, directly blaming the new rules.
What is the Government reconsidering?
The Treasury is now actively reviewing:
- Whether global assets should be fully exposed to UK inheritance tax
- How changes to Business Property Relief and Agricultural Property Relief are affecting British business owners
- The wider impact on the UK’s attractiveness for international investors
A senior insider revealed that the Government is trying to ‘backtrack without backtracking’, which could be a signal that Rachel Reeves may amend the rules without appearing to soften Labour’s tax stance too much.
How could this affect your estate planning?
If you are a business owner, entrepreneur, or high-net-worth individual with overseas assets, the rule changes could significantly increase your tax liability.
Key changes to watch:
- Business Property Relief now capped from April 2026: assets over £1million face a 20 percent tax
- Offshore trust loopholes are closed, increasing inheritance exposure
- Political uncertainty is disrupting long-term estate planning
Many clients are now reassessing whether to stay in the UK, especially when alternative jurisdictions like the UAE and Switzerland offer more generous regimes.
What should you do now?
Whether you are based in the UK or have international links, this is the time to:
- Revisit your estate planning and review IHT exposure
- Check how changes to reliefs could affect you
- Speak to a tax adviser to explore international structuring or mitigation strategies
Need support?
At Nordens, our expert tax and advisory teams help individuals and businesses navigate inheritance tax, non-dom rules and international planning. If you think the changes may affect you, we are here to guide you.
👉 Get in touch with us today or book an estimated quote
