The non-dom survey found that 46% of respondents said they were considering leaving the UK for good in the near future, citing Brexit and changes to their tax status as a reason.
This compares with 37% in the same survey this time last year. Meanwhile, 10% have already left.
The UK “has become significantly less attractive to non-doms in recent years, who pay up to a £90,000 annual charge should they wish to be taxed on a remittance basis”, the company said.
Simon Baylis, partner at Moore Stephens, said: “It’s clear that non-doms have serious concerns about their futures in the UK.
“Many non-doms have been squeezed by tax law changes over the last decade or so, but Brexit could be the tipping point. If half of the non-doms choose to leave the UK – as our research suggests could be likely – the government could lose close to £5bn in revenue.”
Weakened position
High numbers of non-doms leaving the UK could cause serious harm to the economy, particularly post-Brexit where foreign direct investment will be more important than ever, the firm added.
UK non-doms contributed £9.3bn in tax and national insurance receipts in 2014/15, according to the latest available data from HM Revenue & Customs, and employ thousands of UK citizens through their businesses.
“This illustrates the significant revenue loss and revenue drain that the UK could face should non-doms continue to leave the country,” Moore Stephens said.
Deemed domicile
The research comes ahead of further government reforms to tax rules for non-doms, which had been due to come into effect in April 2017 but were delayed ahead of the snap election.
The new laws will see non-doms who have been resident in the UK for 15 of the past 20 years become ‘deemed domiciled’. This means they will be treated as if they were UK citizens for all tax purposes, resulting in them paying more tax than they do currently, with the exception of certain trust arrangements.
The government recently published an updated Finance Bill 2.0 confirming its intention to introduce these reforms with effect from 6 April 2017.
Intentions of leaving
Findings from Moore Stephens’ include that 53% of surveyed non-doms believe that more competitive tax rates would persuade them to remain in the UK.
Of those who have already relocated from the UK, the most popular destinations were the US (29%) and Monaco (14%).
Similarly, those who are planning to leave said that Switzerland (14%), the US (10%), and Monaco (7%) were the most attractive destinations.
