Higher Earners: Emigration

Question

Asked by

To ask His Majesty’s Government what assessment they have made of the number of individuals earning more than £100,000 per annum who left the country in 2025.

My Lords, not all taxpayers are required to notify HMRC when they leave the country. As such, the Government do not hold comprehensive data on the number of individuals leaving the UK by income level. The Government are committed to ensuring that the UK remains a competitive and attractive location for internationally mobile talent and investment. We continue to support growth through a competitive tax framework and a world-leading business environment.

The Minister is right: HMRC has no idea of the number of people who have left the country with a high income. The Chartered Institute of Taxation and I have tried to find the information, but it does not exist. However, most helpfully, the Sunday Times last Sunday looked at people on the Companies House database who have told Companies House that they are leaving the country. It estimates that as few as one in six and as many as one in three of the people on the Sunday Times wealth list have left the country. Can the Minister explain why he thinks that is and how this helps the growth agenda?

As the noble Lord says, the data is not available, so I am not sure that he can make the conclusions that he seeks to make. The data will not be available until we have the January 2027 self-assessment data, which is the most reliable data. The costings that were certified by the OBR for the previous Government’s and this Government’s reforms account for a potential behavioural response. They factor in an assumed level of migration from non-doms, just as they did for the previous government reforms. The OBR has said that there is no evidence to change the estimated impact of the reforms on migration. This has always been a highly mobile population. For example, in 2023-24, there were 9,100 arrivals and 9,500 leavers, so the noble Lord knows that this is nothing new. The reforms to the tax treatment of non-doms have been designed specifically to make the UK competitive, with a modern, simple tax regime that is also fair.

My Lords, I have a personal interest in this. Do the Government recognise that outdated tax treaties are driving away talent that the UK wants, especially in life sciences and AI? Many overseas nationals, especially Americans, end up paying significantly more tax than any equivalent UK-only citizen. It is not a non-dom issue but a failure to modernise relief to deal with tax savings such as ISAs, investments in mutual funds and the complexity of death duties. Will the Government get to grips with this?

The new residents-based regime is more competitive for new arrivals than the previous rules. It is more attractive than the previous approach. They can bring their foreign income and gains into the UK without attracting an additional tax charge. These changes will encourage individuals to spend and invest these funds in the UK.

My Lords, is it not the case that if you are a patriot you are obliged to pay your fair share of tax and that people who do not want to do that are not patriots?

We must ensure that the wealthiest pay their fair share of tax towards the public finances. Equally, successful businesses and entrepreneurs who create jobs and wealth are the engine of economic growth in this country and we must do all that we can to support them.

My Lords—

My Lords—

My Lords, it is the turn of the Cross Benches.

My Lords, does the Minister agree that the tax avoidance industry in this country appears to continue to thrive? If so, how does he explain that?

This Government have been very clear that we will close down any tax loopholes that we can while ensuring that the tax regime remains highly competitive. That is exactly what we are doing.

The Minister talked about celebrating entrepreneurs and business creation. According to City A.M., nearly 6,000 British business owners have quit the UK over the past two years. Why is this?

As I have already said, there is no reliable data to back up the noble Lord’s claims. The reliable data will be available in January 2027, when the self-assessment returns are made. The data does not exist to make the noble Lord’s claims. The UK is a great place to start a business, but our companies are not scaling at the same rate as their US peers. We are taking action to ensure that they do, that the business environment in this country remains competitive and that we have a competitive tax regime.

My Lords, is my noble friend the Minister aware of the hard data provided by Patriotic Millionaires, which shows that the strong majority are proud to live in this country, believe that it is patriotic to pay their fair share of tax and, in fact, are prepared to pay a little more, particularly to help young people?