London, United Kingdom – David Lesperance, a Canadian wealth adviser based in Poland, is working against the clock for one of his British clients.
John*, who requested anonymity, is trying to relocate to Dublin, the Irish capital, ahead of November 26, when Chancellor Rachel Reeves will deliver the budget – a statement presenting the Labour government’s plans for public finances for the year ahead.
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Having built a company worth around 70 million pounds ($92m) that he plans to sell soon, John wants to avoid a hefty capital gains tax bill.
As his children are in university, upping sticks is possible. He hopes to take advantage of the Republic of Ireland’s non-domiciled, or “non-dom”, tax regime, which would exempt him from Irish taxes as well.
“We’ve been moving fast to organise his immediate departure to Ireland,” said Lesperance, who has been assisting him in shifting his assets abroad. “With higher taxes looming, the costs of leaving early are a rounding error.”
John is not alone.
The footballer Rio Ferdinand has recently moved to Dubai, citing tax as a push factor, while Egyptian billionaire and Aston Villa co-owner Nassef Sawiris, who moved his residency to Italy and the United Arab Emirates from Britain, told the Financial Times earlier this year that everyone in his “circle” is considering moving.
Herman Narula, the 37-year-old British Indian founder of Improbable, a tech company, announced this month that he is fleeing to Dubai. Worth about 700 million pounds ($920m), he is said to be Britain’s richest young entrepreneur. Among his reasons for fleeing were reported plans by the Labour government to impose an exit tax on wealthy people leaving the United Kingdom.
While that proposal appears to have been ditched, the overall business environment for entrepreneurs is increasingly unpredictable, Narula and a few others say.
“There is alarming evidence that some entrepreneurs are leaving the UK,” reads a recent open letter to Reeves, signed by more than a dozen wealthy business owners, including Nick Wheeler, founder and chair of the men’s clothing retailer Charles Tyrwhitt, and Annoushka Ducas, a jewellery designer.
“As the government prepares for this year’s Budget, it must carefully consider the cumulative impact of these policies on entrepreneurs,” the letter warns.
When the budget is delivered, all eyes will be on any changes to taxation – an issue affecting everyone in the UK. In recent months, speculation about tax amendments on property, incomes and pensions has repeatedly made headline news.
Rumours about the superrich abandoning the UK have been swirling for an even longer period, triggered by the mere prospect of a Labour government last year. Since the Keir Starmer-led government was elected last July, a range of media outlets have homed in on case studies suggesting that Labour is driving wealth out.
The first Labour budget last October outraged some high-earning individuals in the UK, who said they were already taxed too much.
“Last year’s Budget measures, including changes to Capital Gains Tax, Entrepreneur’s Relief, and Employer National Insurance, have increased costs for many entrepreneurs and enterprises,” read the recent open letter from wealthy business owners to Reeves.
Those changes came after the Conservatives abolished the non-dom regime, a status that allows for people with a residency abroad to avoid taxes in the UK.
But experts have offered words of caution on the supposed flight of the rich.
There is no official data on the number of wealthy individuals leaving because of Labour’s tax changes.
“The most recent tax data on wealthy individuals with non-dom status from HMRC [His Majesty’s Revenue and Customs, the UK’s tax revenue department] shows that the number of non-doms leaving the UK is in line with or below official forecasts,” said Mark Bou Mansour, an advocate at the Tax Justice Network.
Claims that recent revenue-boosting tax reforms have triggered a massive non-dom exodus are false and part of a wider rhetoric that is detrimental to the UK’s fiscal and economic health, he said.
“Talking about whether the superrich will move if we tax can be a distraction from talking about the harms to economies and democracies that arise from not taxing extreme wealth,” he said.
Mansour pointed to a 2024 study by the London School of Economics that interviewed a number of wealthy individuals. It found the most important factors underpinning their reluctance to migrate were their attachment to the capital’s cultural infrastructure, private health services and schools, and the ability to maintain social ties.
“There’s plenty of strong evidence showing that the superrich don’t choose to relocate just to pay less tax,” said Mansour.
Behind a large number of articles predicting an exodus of wealthy people was a report by the passport advice firm Henley & Partners.
However, the report was found to be based on flawed methodology, and was later amended.
Even so, Lesperance said he has worked with a number of clients who have left the UK since Labour came into power.
He argued that while not necessarily large in number, the group makes up a high percentage of overall tax revenue raised by the government.
“The tax contribution of a non-dom is about 220,000 pounds ($289,000) a year, which is about six or seven times the UK average,” he said, “They’re super contributors” who need to be protected, or else, “You’re going to actually see a drop in annual tax collections because these people have left.”
Some of his clients have chosen to relocate to Milan and Dubai.
“As one of my clients said, ‘London’s nice, but it’s not that nice,’” he said.
But Michelle White, head of private office at UK wealth management firm Rathbones, said that while her clients are internationally mobile and could move away, the majority have stayed put so far.
“Since some of these articles started coming out saying the floodgates are open, we haven’t seen that,” she said.
Britain’s schools, legal system and business environment continue to be pull factors, she argued.
Those who have left usually have ventures or properties abroad and can easily relocate, or are considering selling their business in the next two years or so, and do not want to pay capital gains tax on sales.
Others have big payouts from private equity or hedge funds and want to avoid paying income tax.
“It means that they’ll go and spend more time somewhere else and less time here in order to not pay UK tax on that sale,” said White.
A large extent of her clientele in the end decides to stay in the UK to raise families, and mitigates taxation through smart planning.
“I tell people to look at the next 50 years and plan taxes around that,” she said, “People take a long view.
“Tax is one thing, but quality of life and how you actually want to live as a family often overrides the tax aspect.”
