Domicile of individuals

STOP PRESS: Abolition of non-dom regime and introduction of residence-based IHT regime

Finance Act 2025 (FA 2025) which received Royal Assent on 20 March 2025, implements legislation to abolish the remittance basis of taxation and replace it with a residence-based regime, commencing on 6 April 2025. FA 2025 also replaces domicile as the key factor in establishing liability to inheritance tax. Other changes include amendment of the rules determining excluded property status, the abolition of protected settlements status of offshore trusts, and changes to overseas workday relief.

For information on these changes, see Practice Notes: The abolition of the remittance basis of taxation from 2025–26 and A new residence-based regime for IHT from 2025–26. See also: Finance Bill Tracking Service: Key dates (Finance Bill 2025) and Finance Act 2025.

Many questions concerning the personal status of an individual are governed by their personal law. The primary purpose of determining domicile is to identify this personal law by considering factors which connect the person to a territory with a distinctive legal system. Everyone must have a domicile.

The domicile of the individual

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Double taxation tiebreakers—meaning of POEM (Haworth v HMRC)

Private Client analysis: The Court of Appeal has found that the test of ‘Place of Effective Management’ (POEM) in a double taxation treaty (DTT) is not the same as the central management and control (CMC) test for company residence. POEM is frequently used in DTTs as a tiebreaker to determine in which of two contracting states a person other than an individual (eg a company or trust) is resident for the purposes of the DTT. There is limited case law, either in the UK or internationally, on how the test should be applied. The court rejected the appellants’ submissions that a tribunal determining POEM should adopt a test derived from the CMC case of Wood v Holden, with the focus upon whether the decision-making functions of the constitutional organs have been usurped or dictated to. It found no support for this submission in authorities or materials admissible to interpret the DTT. Written by Christopher Stone KC, barrister at Devereux Chambers.

Government responds to 2024 MLR consultation

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Private Client weekly highlights—17 July 2025

This week’s edition of Private Client highlights includes: (1) Legislation Day is on 21 July 2025; (2) the ICAEW has launched a consultation on proposed probate registration fees for 2026; (3) analysis of Rogers v Wills, a rare example of the court finding a contract for care existed between family members; (4) the Investing and Saving Alliance proposes alternative approaches to the government’s pension IHT reforms; (5) Marcus v Marcus in which the appeal court upheld the decision that the word ‘children’ included a non-biological son; and (6) analysis of Mobile Telecommunications Company KSCP v HRH Prince Hussam Bin Saud Bin Abdulaziz Al Saud in which the court rules on the meaning of ‘place of residence’ in a bankruptcy jurisdiction appeal.

Question of the week: If an executed deed of appointment under a trust is missing the name of the appointee (due to a clerical error) would the courts generally admit evidence of the intention of the appointors as an aid to construction of the document? Or would rectification be required?

This Q&A considers whether, if an executed deed of appointment under a trust is missing the name of the appointee (due to a clerical error) would the courts generally admit evidence of the intention of the appointors as an aid to construction of the document, or would rectification be required.