What is the four-year FIG regime for new UK residents?

Full answer

The FIG (Foreign Income and Gains) regime replaced the old domicile-based remittance basis system from 6 April 2025, fundamentally changing how newly UK-resident individuals with foreign income are taxed. **Who qualifies** To use the FIG regime, an individual must not have been UK tax resident in any of the 10 consecutive tax years immediately before the year they become UK resident. Qualifying individuals can then claim FIG relief for up to 4 tax years of UK residence -- it does not need to be the first 4 years back-to-back necessarily, but the entitlement runs out after 4 qualifying years of residence in total. **What the relief actually does** During a qualifying FIG year, foreign income and foreign capital gains are completely exempt from UK tax if a claim is made -- unlike the old remittance basis, there is no requirement to keep the money offshore to keep it tax-free, and no remittance basis charge is payable (previously up to £60,000 a year for long-term non-doms). This means funds can be brought into the UK and spent freely without triggering a UK tax charge, provided the FIG claim is made for that year. **Cost of claiming** Claiming FIG relief for a tax year means giving up the UK Personal Allowance and the CGT annual exempt amount for that year, similar to how the old remittance basis worked -- so it is only worth claiming if your foreign income and gains are large enough that the tax saved outweighs those lost reliefs. **Worked example** Maria moves to the UK in 2026/27 having lived and worked in Singapore for the previous 15 years (so she meets the 10-year non-residence test). She retains substantial foreign investment income and rental income from a Singapore property. By claiming FIG relief, all of that foreign income is completely tax-free in the UK for each of her first 4 tax years of residence, and she can transfer the money into a UK bank account and spend it freely without any UK tax charge -- something that was much harder under the old remittance basis, which taxed money as soon as it was brought ('remitted') into the UK. **After the 4 years** Once the 4 qualifying years are used up, the individual becomes taxable on worldwide income and gains in the normal way, like any other UK tax resident -- there is no extension or renewal of FIG relief regardless of domicile status, which the regime has abolished as a relevant concept for Income Tax and CGT purposes (domicile still matters for Inheritance Tax under transitional long-term residence rules). **Why this replaced the old system** The FIG regime is simpler to administer (no complex remittance tracing rules) and time-limited, reflecting a policy shift towards taxing long-term UK residents on their worldwide income regardless of domicile, while still offering a generous but strictly time-limited incentive for genuinely new arrivals to bring foreign wealth and investment into the UK economy.

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