UK Trends and Developments Contributed by: Roger Gherson, Thomas Cattee, Lisa Uttley and Amalia Gherson, Gherson Solicitors
central considerations. However, general safety (dis - cussed below) must now sensibly be considered by all. To state the obvious, HNW families emanate from all jurisdictions. Given the changing and increasingly polarised geopolitical landscape, those advising fami - lies who may have cause to fear that they may be at risk of either political attack or politically motivated prosecution from their country of origin (or any other country), whether now or in the future or who may be facing EU/UK sanctions, must now consider a wider set of questions. Safety Since the end of the Second World War, Europe has been regarded as a safe zone and especially so since the end of the Cold War. With safety as the primary consideration, the UK came to offer particularly posi - tive and incentivising tax breaks for non-doms. Over the last decade, however, there has been an accel - eration of wealth moving away from the UK, as it has become less attractive for tax purposes, towards other areas of the world, particularly the Middle East. Countries such as the UAE, Bahrain and Qatar became increasingly inviting because of their friendly tax regimes, whilst at the same time offering little to no prospect of regional conflict. That appears to have now changed. For over four years, however, the ongoing Russia/ Ukraine conflict has threatened the safety of much of Eastern Europe and the Caucasus. More recently, the Iran/US conflict has had a widespread impact on the Middle East with global implications and has simul - taneously sown internal division in the US and grow - ing unease in Southeast Asia. Ongoing conflicts in Africa have made HNWs increasingly wary of putting their eggs in the basket of one particular region. The advice to wealth managers and advisors must surely be that now is the time to develop serious, diverse and continuously considered “insurance” plans (ie, fallback plans in case risks to the family’s safety sud - denly spike). The picture in the UK and Europe, however, is not necessarily all rosy. Crime on the streets of London and other big cities remains a serious concern for gen -
eral safety. Last year’s reform of the non-dom regime, the growing tax burden and the rising cost of doing business must remain considerations, whilst inter - nal political instability is creating a somewhat more febrile atmosphere than it may have been for HNW and UHNW individuals a decade or two ago. The UK’s replacement FIG scheme offers little competition for the clarity, longevity or certainty of the other European schemes currently on offer and it is extremely unlikely that this Government will reverse the abolition of the non-dom regime. From a tax planning perspective, all this makes the UK decidedly unattractive. Having said this, the UK remains highly attractive for its overall safety and the cultural, educational and social facilities available. Currently, however, the people who may agree are few and far between, as reflected by the complete collapse of the high-end property market. Although press speculation by one or two estate agents anxious to market their services has talked up the market, this is not the sentiment mirrored by other well-established agents. The UK has not become – and will not become – the automatic destination for every internationally mobile family. But for those weighing up a broader set of pri - orities – culture, education, legal protection and per - sonal security, alongside a favourable tax regime – the UK deserves to be considered on its full merits as an enduring and compelling option. Given all that has been said above, competent, coher - ent and strategic advice regarding any potential relo - cation needs to focus on a core set of issues. Any HNW considering their position (along with their advi - sors) must first and foremost ask themselves three key questions. • Question 1: What is the nationality of the family members? • Question 2: Are any of the family members at risk of political attack or politically motivated prosecu - tion from their country of origin or any other coun - try (now or in the future)? • Question 3: Are any family members from a country that is likely to be impacted by EU, UK or US sanc - tions in the future?
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