Where the exit tax story came from

In November 2025, newspapers reported that the Treasury was considering a 20% "settling-up charge". It would have taxed wealthy people leaving the UK on gains they hadn't yet realised. [3] Within 2 weeks, the plan was reported to have been dropped. [4]

Neither Budget since has brought in such a charge:

  • The November 2025 Budget contained no exit charge on individuals. [2]
  • The Budget of 28 October 2026 contains none either. The only "exit charge" in its list of tax measures is a technical easing for certain trusts that move in and out of the UK (measure 1.28). [1]

UK companies and trusts can already face exit charges when they stop being UK resident. [1][6] Individuals can't: once you're non-UK resident, you don't usually pay UK capital gains tax on selling your assets, apart from UK property and land and the return rule below. [5]

The idea could return in a future Budget. As of 28 October 2026, HM Treasury has announced no exit charge on individuals. [1] We update this page after every Budget.

What can still follow you when you leave

1. The 5-year rule on coming back

The rule applies to you if: [7]

  • you were UK resident in at least 4 of the 7 tax years before you left, and
  • you return after 5 years or less away.

If it applies, gains you made while abroad, on assets you owned when you left, are taxed in the tax year you come back. [7][8]

Since 6 April 2026, the rule reaches further. The rule already taxed dividends from your own company on your return, except dividends paid out of profits the company made after you left. For people returning on or after 6 April 2026, that exception has gone. [9]

To be outside the rule, you need to be away for more than 5 years (5 years and a day is enough). If the year you leave isn't a split year, that means 6 complete UK tax years. With a split year, the time away starts part-way through the year you leave. [7]

2. UK property and land

Non-residents remain liable to UK capital gains tax on gains from UK land and property. That includes homes and commercial property. It also includes shares in a company that gets at least 75% of its value from UK land, if you hold 25% or more of it. [5][10] A sale must be reported to HMRC within 60 days of completion, even if no tax is due. [11]

3. Inheritance tax

Since 6 April 2025, UK inheritance tax on assets outside the UK depends on how long you have lived here. If you were UK resident for at least 10 of the last 20 tax years, your worldwide assets stay within UK inheritance tax for a period after you leave. That period ranges from 3 to 10 years, depending on how long you lived in the UK. [12][13]

Assets in the UK, such as a London home, remain within UK inheritance tax whatever your residence. [14]

See our guide: UK inheritance tax after you leave.

4. Becoming non-resident in the first place

These rules apply only once you are non-UK resident under the Statutory Residence Test, which is decided each tax year from your days in the UK and the ties you keep here. [7]

See our guide: Am I still UK tax resident?.

Before you leave: what to settle

  • Your residence position for the tax year you go, and for the year after.
  • Timing of any business sale. Selling while UK resident and selling after you've left are taxed under different rules. The Business Asset Disposal Relief limit falls to £500,000 from 6 April 2027. [1] See Selling your business before April 2027.
  • Dividends you plan to take from your own company while abroad, given the 2026 change to the 5-year rule.
  • UK property you'll keep, and how a future sale will be taxed.
  • Your estate plan, given the inheritance tax period after you leave.
  • Telling HMRC. If you don't usually file a Self Assessment return, you tell HMRC you're leaving on form P85. If you do, you use the residence pages of your return (SA109). [15]
  • Your new home's rules. In the UAE, for example, residency, a tax residency certificate and banking each need their own preparation.

How Marlborough Gulf helps

The return rule, a business sale and the inheritance tax period each start from the date you stop being UK resident, so their timetables need to be set together.

What we do:

  • We set out the timetable for the sale, the move and your estate plan.
  • We coordinate the specialists involved.
  • On the UAE side, we handle company and structuring work directly.

What our partners do:

  • A UK tax adviser gives formal UK tax advice and handles your returns.
  • Lawyers deal with contracts and estate documents.
  • Banks and wealth managers take care of your money.

You appoint and contract with each specialist directly. Marlborough Gulf does not give investment, pension or insurance advice. Regulated services are provided by licensed firms, who contract with you directly.

Book a consultation

Questions people ask

Does the UK charge tax when I emigrate?

No. Becoming non-resident doesn't by itself create a UK tax charge for an individual. [1][5]

Is there a 20% exit tax in the UK?

No. A 20% "settling-up charge" was reported in November 2025 and reported dropped within 2 weeks. Neither the November 2025 nor the 28 October 2026 Budget introduced one. [1][2][3][4]

Was an exit tax introduced in the 2026 Budget?

No. The 28 October 2026 Budget contains no exit charge on individuals. [1]

Does HMRC know if you move abroad?

You tell HMRC yourself: on form P85, or through the residence pages of your Self Assessment return. [15]

Do I still have to pay UK tax if I move abroad?

You may, on UK income such as rent from a UK property, and on gains from UK property. [5][16]

If I sell my company after moving to Dubai, do I pay UK tax?

Not usually on shares, provided you have become non-UK resident and stay away for more than 5 years. The main exception is a company that gets at least 75% of its value from UK land. [5][7][10]

What if I come back after 3 years?

Gains you made while away, on assets you owned before leaving, can be taxed in the year you return. Since April 2026 that also includes dividends paid out of profits your company made after you left. [8][9]

Do I still pay tax on my London flat?

Yes. Gains on UK property remain within UK capital gains tax, and UK property is always within UK inheritance tax. [5][14]

This guide is general information, not personal tax advice. Rules change, and your position depends on your circumstances. Speak to a qualified UK tax adviser before acting.

Related guides

Sources

Last checked 28 October 2026.

  1. HM Treasury and HMRC, Budget 2026: Overview of tax legislation and rates, 28 Oct 2026 (measure 1.28 concerns trusts only; measure 1.33 is the BADR limit). https://www.gov.uk/government/publications/budget-2026-overview-of-tax-legislation-and-rates-ootlar/budget-2026-overview-of-tax-legislation-and-rates-ootlar
  2. HM Treasury and HMRC, Budget 2025: Overview of tax legislation and rates, 26 Nov 2025. https://www.gov.uk/government/publications/budget-2025-overview-of-tax-legislation-and-rates-ootlar/budget-2025-overview-of-tax-legislation-and-rates-ootlar
  3. Gulf News, "UK weighs 20 per cent exit tax on wealthy emigrants" (reporting The Times), 2 Nov 2025. Press report, cited only for what was reported. https://gulfnews.com/world/uk-weighs-20-per-cent-exit-tax-on-wealthy-emigrants-1.500330614
  4. International Adviser, "UK Chancellor scraps plans for 'exit tax'" (reports), 14 Nov 2025. Press report, cited only for what was reported. https://www.international-adviser.com/uk-chancellor-scraps-plans-for-exit-tax-reports/
  5. GOV.UK, Tax on your UK income if you live abroad: selling or inheriting assets. https://www.gov.uk/tax-uk-income-live-abroad/selling-or-inheriting-assets
  6. Taxation of Chargeable Gains Act 1992, section 185 (companies ceasing to be UK resident) and section 80 (trustees ceasing to be UK resident), legislation.gov.uk. https://www.legislation.gov.uk/ukpga/1992/12/section/185 https://www.legislation.gov.uk/ukpga/1992/12/section/80
  7. HMRC, RDR3: Statutory Residence Test notes (including temporary non-residence), updated 11 Jun 2026. https://www.gov.uk/government/publications/rdr3-statutory-residence-test-srt/guidance-note-for-statutory-residence-test-srt-rdr3
  8. HMRC, HS278 Temporary non-residents and Capital Gains Tax (2026), updated 6 Apr 2026. https://www.gov.uk/government/publications/temporary-non-residents-and-capital-gains-tax-hs278-self-assessment-helpsheet/hs278-temporary-non-residents-and-capital-gains-tax-2026
  9. Finance Act 2026, Schedule 3, Part 3 (temporary non-residence), in force for 2026–27 onwards, legislation.gov.uk. And HMRC policy paper, Temporary non-residence rules: post departure trade profits, 26 Nov

    https://www.legislation.gov.uk/ukpga/2026/11/schedule/3 https://www.gov.uk/government/publications/temporary-non-residence-rules-post-departure-trade-profits/post-departure-trade-profits

  10. HMRC, Capital Gains Manual CG73930: indirect disposals of UK property-rich companies (overview), updated 22 Oct 2026. https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg73930
  11. HMRC, Tell HMRC about Capital Gains Tax on UK property or land if you're not a UK resident. https://www.gov.uk/guidance/capital-gains-tax-for-non-residents-uk-residential-property
  12. GOV.UK, Inheritance Tax if you're a long-term UK resident. https://www.gov.uk/guidance/inheritance-tax-if-youre-a-long-term-uk-resident
  13. HMRC, Inheritance Tax Manual IHTM47020, updated 7 Apr 2026. https://www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm47020
  14. GOV.UK, Inheritance Tax: if you die when you are based outside the UK. https://www.gov.uk/inheritance-tax/when-someone-living-outside-the-uk-dies
  15. GOV.UK, Tax if you leave the UK to live abroad. https://www.gov.uk/tax-right-retire-abroad-return-to-uk
  16. GOV.UK, Tax on your UK income if you live abroad. https://www.gov.uk/tax-uk-income-live-abroad