Chancellor George Osborne has announced plans to abolish permanent non-dom tax status with effect from April 2017.
Delivering his Summer Budget today, Osborne argued scrapping non-dom status altogether would “simply cost the country money”, but he admitted there were “fundamental flaws” with the current system.
He said: “Non-dom tax status was meant to be temporary but for some people it has become permanent, but not anymore.”
The proposals will cover non-doms who have spent 15 of the last 20 years in the UK, and will require those individuals to pay the same tax as everyone else.
The Government will consult on the move, which it says will raise an extra £1.5bn.
Osborne has identified an overall £5bn in savings by clamping down on tax avoidance.