Former remittance basis users and the Temporary Repatriation Facility

The rules around UK residence, domicile, and how your overseas income is taxed have changed significantly.

If you are originally from outside the UK and previously claimed the remittance basis of taxation, you need to know about a time-limited opportunity called the Temporary Repatriation Facility (TRF). This facility allows you to bring previously untaxed foreign income and gains into the UK at a much lower tax rate than usual.

How the old rules worked

Previously, if you were a non-UK domiciled individual living in the UK, you could choose to pay tax on the remittance basis for your first few years here. This meant you only paid UK tax on your UK income, and your offshore income was left untaxed as long as it stayed abroad.

Under those old rules, if you ever decided to bring that historic foreign income into the UK, it would face standard UK tax rates of up to 45% in the year you imported it.

The new opportunity

The TRF is a window of opportunity running from 6 April 2025 to 5 April 2028. It allows you to designate a specific amount of your past, unremitted foreign income and pay a flat, reduced tax rate on it.

Once you pay this reduced rate, those funds become completely tax-free to bring into the UK at any point in the future. Crucially, you do not actually have to physically move the money to the UK yet. You can choose to pay the lower tax rate now to clear the money for future use.

The tax rates and deadlines

The tax rate you pay depends on the tax year in which you make the declaration on your UK self assessment tax return.

• Tax year ending 5 April 2026: 12% tax charge
• Tax year ending 5 April 2027: 12% tax charge
• Tax year ending 5 April 2028: 15% tax charge

Any historic foreign income that you do not declare during this three-year window will miss out on these rates. If you bring that undocumented money into the UK later, it will be taxed at standard UK rates up to 45%.

An example

Joe moved to the UK from Australia a few years ago. While living in the UK, he claimed the remittance basis and left £100,000 of investment income in his Australian bank account, meaning he paid no UK tax on it at the time.

Joe now wants to buy a property in the UK and needs to use that £100,000.

• Without the TRF: If Joe simply brought the money over under the old rules, he could face a UK tax bill of up to £45,000.
• With the TRF: Joe declares the £100,000 on his current UK tax return. He pays a flat 12% fee (£12,000) using UK funds. The remaining £100,000 in Australia is now fully cleared. He can transfer it to his UK bank account whenever he likes without paying another penny of tax, saving himself up to £33,000.

Who this applies to

This facility is highly specific. It only applies to individuals who meet all of the following criteria:

• You are originally from outside the UK (non-UK domiciled).
• You moved to the UK and became a UK tax resident.
• You chose not to declare your worldwide income during your first few years here because you claimed the remittance basis.

Please note that this does not apply to clean capital, which represents funds you owned before you ever became a UK resident. Clean capital can already be brought into the UK completely tax-free.