One in five British bankers enjoys “non-Dom” tax status – Study | Investment News
LONDON (Reuters) – More than one in five bankers earning at least 125,000 pounds ($164,000) a year in Britain have enjoyed non-domiciled tax status, as have many well-paid workers in other sectors, according to a study released Thursday.
Non-dom status – which exempts more than 75,000 foreign nationals mostly in Britain from overseas income tax – has raised questions about the fairness of the tax system, as it massively benefits to the very rich.
Research from the University of Warwick and the London School of Economics showed that just 0.3% of UK taxpayers earning less than £100,000 in 2018 had claimed non-dom status at some point in the past 20 last years. In contrast, 27% of taxpayers earning £1-2 million had done so.
Two out of five top earners in the oil industry, one out of four executives in the auto industry and one out of six top-earning sports and movie stars have also enjoyed this status.
“The biggest shock could be for bankers and others working in city jobs, when they realize how many of their colleagues benefit from a tax regime they don’t have access to,” said Arun Advani, Assistant Professor of Economics at the University of Warwick.
Non-dom status is only available to UK residents who claim their ‘domicile’ – the center of their personal and financial interests – is outside the UK.
The top three nationalities for non-doms in 2018 were the US, India and France, and 93% were born outside the UK.
Non-doms were most likely to live in central London and around 80 per cent said their main source of income was from a job or a pension, while 20 per cent lived off income from investment or other income abroad.
“A significant minority of non-doms appear to be ‘wealthy rentiers,'” the report says.
The research is based on anonymised individual tax data from 1997 to 2018 provided by the UK Inland Revenue.
(Reporting by David Milliken; Editing by William Schomberg)
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