The UK’s New Wealth Tax Changes: Why Relocating to Malta could be your best option!

UK Tax Updates You Need To Know.

The UK Chancellor announced significant changes in the UK Budget recently and many of the new policies introduced affects inheritance and wealth tax, but there are also significant changes afoot for non-domiciled residents in the UK. These changes are prompting many high-net-worth individuals to consider alternative, tax-friendly countries for their domicile and now might be the perfect time to for you explore relocating to Malta!

UK tax changes that are coming in 2025

From April 2025, substantial tax reforms in the UK will significantly impact high-net-worth individuals and non-domiciled residents. The UK government has outlined plans to raise an additional £40 billion in taxes by implementing stricter tax regulations. Key changes include the abolition of the current non-domiciled tax regime and increases in capital gains tax and inheritance tax allowances. This presents the UK’s high-net-worth individuals and non-domiciled residents with a challenging fiscal outlook which is made far worse due to the very short amount of time left before these changes come into effect.

Details of the new changes

A Capital Gains Tax increase from 10 to 18% for basic-rate taxpayers and higher-rate taxpayer increase from 20% to 24%. Inheritance Tax Adjustments include planned reductions to Inheritance Tax exemptions, such as the £325,000 nil-rate band and the £175,000 residential nil-rate band, which are likely to increase tax liabilities on high-value estates. These adjustments, along with potential caps on reliefs, make estate planning more complex, prompting high-net-worth individuals to consider relocating to more tax-friendly jurisdictions such as Malta.

Another major change will be the abolition of Non-Domicile Status in the UK which, under the current regime currently allows residents to use a remittance basis for foreign income, providing considerable tax relief. Starting April 2025 will see the abolition of non-domicile status, so UK residents will be taxed on their worldwide income, increasing tax burdens for High-net-worth individuals with international assets.

The UK’s non-dom tax rules were originally designed to provide certain tax benefits to individuals who reside in the UK but aren’t domiciled there. The changes to these rules have created considerable discussion and concern among non-domiciled residents, especially its potential tax implications.

What lies ahead for the UK’s non-domiciled residents?

A new Foreign Income and Gain (FIG) regime will be introduced from 6 April 2025. This will apply only to those who have been UK tax residents for fewer than four years after a period of at least 10 years of non-residency. Qualifying individuals will not be taxed on FIG earned during their first four tax years and can transfer these funds into the UK without additional charges. After four tax years of UK residency, the FIG regime will no longer apply, and individuals will be taxed on their worldwide income and gains. This has led to non-domiciled residents reviewing their asset values in the UK, evaluating current tax structures and assessing the impact of double taxation on their assets.

Are you one of those that are considering leaving the UK due to the new tax changes?

With these changes on the horizon in the UK, tax-friendly countries such as Malta are very attractive destinations for high-net-worth individuals and non-domiciled residents looking to relocate to.

The long-standing relationship between Malta and the UK

Malta has an enduring connection to the UK and gained independence from the UK only as recently as 1964, where after it joined the Commonwealth. Malta was also awarded the George Cross by King George IV in 1942, so it is clear to see why the islands are so loved by countless Brits. The islands offer a desirable lifestyle and many financial advantages for wealthy residents, especially for those who are considering investing in property.

The advantages you will enjoy when moving to Malta

There is no Wealth Tax in Malta: One of Malta’s primary draws for high-net-worth individuals is its lack of a Wealth Tax. Unlike the UK’s impending tax plan, Malta does not impose taxes on worldwide assets simply for owning them.
Malta has no Inheritance Tax: Malta also lacks inheritance tax, unlike the UK, where inheritance tax rates can reach 40%. In Malta, only a 5% causa mortis duty applies, allowing you to pass on your wealth without excessive tax concerns. Frank Salt Real Estate can help you find properties that serve as ideal investments for future generations.
Attractive residency and tax programmes: Malta offers programmes like the Malta Permanent Residence Programme (MPRP) and the Global Residence Programme (GRP), providing a flat tax rate of 15% on foreign-sourced income brought into Malta under the GRP. By purchasing a qualifying property through Frank Salt Real Estate, you can benefit from these tax-efficient residency schemes. Malta also offers the option of acquiring citizenship through the Maltese Exceptional Investor Naturalisation (MEIN) program which grants full EU citizenship and the mobility benefits that come with a Maltese passport. If you want to have an overview of all the residency options on offer get in touch with us.
Thriving property market: Malta’s property market is very dynamic, offering excellent investment potential and capital appreciation. Here you can choose from luxury countryside villas to modern seafront apartments or ancient heritage homes and even palaces. Frank Salt Real Estate has a large variety of high-end properties that not only promise a beautiful Mediterranean lifestyle but are also sound financial investments with no concerns about wealth or inheritance tax. Want to see properties are on offer? Click here.
An unmatched lifestyle: Beyond tax advantages, Malta’s lifestyle is exceptional. With over 300 days of sunshine, stunning coastlines, a rich cultural heritage and excellent healthcare and education systems, Malta offers an ideal blend of work, relaxation and family life. Its strategic location also provides easy access to Europe, North Africa, and the Middle East and with its international airport at Luqa, major European destinations like Monaco, London, Paris, Barcelona, Munich and Rome are only a two-hour-plus flight away!

More about Frank Salt Real Estate

If you are considering relocating to Malta, the Frank Salt Real Estate Group should be your go-to partner to make the transition effortlessly. We can find you the ideal home to buy or rent and even assist with obtaining residency or Maltese citizenship! We specialise in anything related to the buying and selling of residential, commercial and rental properties and we also have divisions that deal with property management and home interior services. Frank Salt Real Estate was founded in 1969 and each year has helped countless foreign nationals to relocate to Malta. We provide access to other professional services such as insurance, relocation, immigration and taxation through our bespoke connections. Our reputation for getting things done has made us the trusted relocation partner for clients worldwide.

Why Choose Frank Salt Real Estate?

Our team brings with them the experience and expertise needed to ensure you achieve your property and relocation goals and we will be personally guiding you every step of the way. If you want to know more about us, click here.

The takeout

With the UK preparing to implement its new tax changes, moving your residency or domicile to Malta can be a strategic way to protect your assets and enjoy a favourable tax regime. With our current favourable tax regime and an appealing lifestyle, Malta presents an excellent option for safeguarding your financial future. If you are contemplating the move, now is the time to contact us at Frank Salt Real Estate and benefit from our trusted guidance.