Changes in Russian Tax Law to Force Migration to UK
The Russian government has passed new tax legislation that will force Russian taxpayers to pay taxes in Russia on retained earnings of foreign-registered entities they control. These changes form part of the “deoffshorisation” policy initiated in 2012 by President Putin, which are aimed at bringing Russian businesses and money “home” from foreign jurisdictions. The new legislation will make it illegal to conceal assets in offshore structures from 2017 onwards.
It is expected that these changes will results in more Russians moving to the UK, as the UK tax regime for non-domiciled (“non-doms”) taxpayers is very favourable. A non-dom is able to claim the remittance basis of taxation in order to shelter non-UK investment income and gains from UK tax, meaning they will only suffer UK tax on UK source income. In essence, if structured correctly, this means that rather than paying UK tax on a worldwide basis, a non-doms overseas income and gains are only taxed in the UK if they are “remitted” to in the UK.
We have a number of Russian clients who have entered the UK under Tier 1 Investor and Entrepreneurial VISAS and provided support and advice to ensure they fully optimise their non-dom status and ability to claim the remittance basis.
If you are planning to move to the UK we would recommend that you take advice prior to your arrival, please contact our Private Client team in London for a free initial consultation.