The measure

FA 2008 extended the scope of what counts as a remittance of foreign income or gains by a resident, non-domiciled individual. Since April 2008, a remittance also occurs where income or gains are gifted abroad to family or controlled entities and then brought to the UK.

Remittances by a 'relevant person' include those by certain close family members and close companies in which the non-domiciliary or his family are participators. Any such company involved in making a remittance is likely to be non-resident. Normally, a non-resident company cannot be close. The FA 2008 legislation recognised this by treating non-resident 'remittance' companies as close. However, this did not explicitly extend to a subsidiary of the non-resident company used for remittance purposes. This defect will now be corrected.

Who will be affected?

High net worth non-domiciliaries who seek to remit foreign income or gains to the UK by gifting it to a controlled offshore entity which then transfers the funds to the UK.

When?

The change will have effect from 6 April 2010.