🇬🇧 Taxes · United Kingdom
Taxes in the UK in 2026 for residents and non-residents
Four years free of UK tax on foreign income for newcomers - and 62% on every pound of salary between £100,000 and £125,140. A full guide to UK taxes for 2026/27: salaries, National Insurance, companies and dividends, VAT, property, inheritance, crypto, the rules for non-residents and double tax treaties.
The short answer: in the 2026/27 tax year the UK charges income tax at 20%, 40% and 45% above a £12,570 tax-free allowance (19-48% in Scotland), National Insurance of 8% on an employee's pay and 15% for the employer, corporation tax of 19-25% and VAT at 20%. Residents pay tax on worldwide income, but new residents who have not been UK tax resident for 10 years can go 4 years without paying it on foreign income.
UK tax rates in 2026 at a glance
The UK takes 20% to 45% of a salary in income tax, up to 25% of company profits and more than £90,000 in stamp duty on a £1.5 million home. Yet new residents can go four years without paying any UK tax on their foreign income. That is the central contradiction of the British system: expensive over the long run, surprisingly gentle at the door.
The tax year does not follow the calendar: the 2026/27 year runs from 6 April 2026 to 5 April 2027. Taxes are collected by HMRC (His Majesty's Revenue and Customs), the UK tax and customs authority. All amounts are in pounds sterling: in 2026 one pound buys roughly 1.3 US dollars or about 110 roubles.
Income tax thresholds are frozen until April 2031. Rates are not rising, but pay is, so every year more income is pulled into the 40% band. Scotland sets its own income tax bands for earnings, and Scotland and Wales each run their own tax on property purchases.
| Tax | 2026/27 rate | Who pays and on what |
|---|---|---|
| Income Tax | 0% up to £12,570, then 20%, 40% and 45% | Residents on worldwide income, non-residents on UK income. Scotland has its own 19-48% scale on earnings |
| National Insurance contributions (state social insurance) | 8% and 2% for employees, 6% and 2% for the self-employed | On pay and profits above £12,570 a year |
| Employer National Insurance | 15% | Paid by the company on an employee's pay above £5,000 a year |
| Dividend tax | 10.75%, 35.75% and 39.35% | Shareholders above the £500 annual dividend allowance |
| Corporation Tax | 19% on profits up to £50,000, 25% above £250,000 | UK companies and UK permanent establishments of foreign companies |
| VAT (Value Added Tax) | 20%, reduced 5% and 0% | Businesses with turnover above £90,000 over 12 months; overseas businesses selling to UK consumers from the first pound of sales |
| Capital Gains Tax | 18% and 24% | Residents on gains above £3,000 a year; non-residents on sales of UK property |
| Inheritance Tax | 40% | Estates above £325,000; for long-term residents, assets worldwide |
| Stamp Duty Land Tax on homes | 0-12%, plus 5% on additional homes and 2% for non-residents | Buyers of property in England and Northern Ireland |
| Council Tax (local property tax) | Set by the local council according to the home's valuation band | Occupiers, or the owner if the home is empty |
| Withholding tax on interest and royalties | 20%, rising to 22% on interest from 6 April 2027 | Payments to non-residents unless a double tax treaty lowers the rate |
There is no wealth tax in the UK and no exit tax for individuals. There is, however, a 40% inheritance tax, and since 2025 it depends not on where the owner comes from but on how many years they have lived in the country. Rates for other countries are in our country-by-country tax overview.
We will calculate online the tax on your income and show how to pay less legally.
Compare taxes in 146 countries: relocation taxes 2026
Who counts as a UK tax resident
UK tax residence can start before a newcomer has spent even two months in the country. With family, a home and a job in Britain plus more than 90 days there in one of the two previous tax years, 46 days in a tax year is enough for a newcomer, and just 16 for a recent leaver. The 183-day rule is only one of several tests here, and far from the strictest.
Residence is decided by law: the Statutory Residence Test in Schedule 45 of the Finance Act 2013. A resident pays UK tax on worldwide income, a non-resident only on income from UK sources. The test runs in steps: first the automatic overseas tests, then the automatic UK tests, and only if neither settles it, the sufficient ties test.
| Test | Condition | Result |
|---|---|---|
| Short visit | Fewer than 16 days in the tax year, if UK resident in one of the previous three years | Non-resident |
| Short visit by a newcomer | Fewer than 46 days, if not UK resident in any of the previous three years | Non-resident |
| Full-time work abroad | An average of 35 hours a week working overseas, fewer than 91 days in the UK and fewer than 31 days working more than 3 hours in the UK | Non-resident |
| 183 days | 183 days or more in the UK in the tax year | Resident |
| Only home | A UK home held for at least 91 consecutive days, with at least 30 days spent there, and no overseas home used for 30 days or more | Resident |
| Full-time work in the UK | Working in the UK over a 365-day period, with 75% of working days in the UK | Resident |
A day counts as a UK day if the taxpayer is in the country at the end of it, at midnight. Changing planes without leaving the airport usually does not count.
The sufficient ties test
If the automatic tests do not decide the matter, ties to the UK are counted. There are five: family (a spouse, partner or minor children who are UK resident), accommodation (a place to live available for at least 91 consecutive days, with at least one night spent there), work (40 or more days working in the UK for 3 hours or more), 90 days (more than 90 days in the UK in either of the two previous tax years) and country (the UK is where the most days were spent in the year; this tie only counts for former residents).
| Days in the UK in the tax year | Resident in one of the previous three years | Not resident in the previous three years |
|---|---|---|
| 16-45 | Resident with 4 ties | Non-resident whatever the ties |
| 46-90 | Resident with 3 ties | Resident with all 4 ties |
| 91-120 | Resident with 2 ties | Resident with 3 ties |
| 121-182 | Resident with 1 tie | Resident with 2 ties |
| 183 or more | Resident | Resident |
In the year of arrival the tax year can be split in two (split year treatment): income before the arrival date is taxed as a non-resident's, income after it as a resident's. Whether the split applies depends on the case, such as moving for a full-time job or acquiring an only home in the UK.
UK residence does not automatically end residence elsewhere. In Russia, for example, tax residence arises after 183 days in the country within 12 consecutive months, and both sets of rules apply in parallel. How to count days and what to do about dual residence is covered in our article on the 183-day rule.
UK tax residency: how to become a resident and count the days
The UK tax year starts on 6 April, and 183 days is just one of the tests. The statutory residence test looks at ties: family, accommodation, work, more than 90 days in either of the two previous tax years. With enough ties, 46 days make an arriver resident and 16 days a recent leaver.
A day counts if you are in the UK at midnight. A resident pays progressive income tax on worldwide income, but newcomers after 10 years abroad pay no tax on foreign income for the first 4 years. The status is confirmed by HM Revenue and Customs.
The law does not stop you from confirming the status on your own. But mistakes cost more: one extra tie turns 100 days in London into residency. Murblz support removes these risks: we run the test step by step, count the nights and obtain the certificate. We guarantee professional work and a transparent process, and in most cases a result on the first filing.
183-day calculator
Tax residency calculator for the UK
Enter your travel dates: the calculator shows whether you are a tax resident of the UK today and at year end, and how many days are left before the threshold.
Counting by dates needs JavaScript. Below are the same rules by country.
How much tax you pay on a salary in the UK: worked example
A £50,000 salary in England leaves about £39,500 in take-home pay; a £100,000 salary leaves about £68,560. The tax share climbs from 21% to 31%, and between £100,000 and £125,140 every extra pound is taxed at an effective 62%, more than millionaires pay on theirs.
Income tax on wages is withheld by the employer through PAYE (Pay As You Earn): the employee receives pay after tax and contributions have already been deducted. The first £12,570 a year, about 16,600 US dollars, is tax-free: this is the personal allowance.
| Annual income, £ | England, Wales, Northern Ireland | Scotland |
|---|---|---|
| Up to 12,570 | 0% | 0% |
| 12,571-16,537 | 20% | 19% |
| 16,538-29,526 | 20% | 20% |
| 29,527-43,662 | 20% | 21% |
| 43,663-50,270 | 20% | 42% |
| 50,271-75,000 | 40% | 42% |
| 75,001-125,140 | 40% | 45% |
| Over 125,140 | 45% | 48% |
Above £100,000 of income the personal allowance melts away: it falls by £1 for every £2 over the threshold and disappears completely at £125,140. That is where the effective 60% income tax rate plus 2% contributions comes from. Pension contributions can bring the bill down, because they reduce taxable income.
National Insurance contributions
National Insurance is the state social insurance system that funds the state pension and benefits. Employees pay 8% on earnings between £12,570 and £50,270 and 2% above that. Employers pay 15% on top on all pay above £5,000 a year; smaller employers can cut their total bill by £10,500 a year (the employment allowance). All thresholds are frozen until 5 April 2031. A full state pension needs 35 qualifying years of contributions, the minimum pension 10.
Worked example: a £50,000 and a £100,000 salary in England
| Step | £50,000 | £100,000 |
|---|---|---|
| Income tax | 7,486 | 27,432 |
| Employee National Insurance | 2,994 | 4,011 |
| Take-home pay per year | 39,520 | 68,557 |
| Take-home pay per month | about 3,293 | about 5,713 |
| Employer National Insurance, 15% | 6,750 | 14,250 |
| Total cost of the employee | 56,750 | 114,250 |
Take-home pay on £50,000 comes to about 52,000 US dollars a year, on £100,000 about 91,000. The same £50,000 salary in Scotland carries £8,982 of income tax, £1,496 more than in England, and at £100,000 the gap widens to £3,300.
What is tax-free
Interest of up to £1,000 a year is tax-free for basic rate taxpayers and up to £500 for higher rate taxpayers; additional rate taxpayers get no allowance. The first £500 of dividends is tax-free. Everything held in an ISA (Individual Savings Account) is free of tax on interest, dividends and gains: up to £20,000 can go in each year, and from April 2027 savers under 65 will be able to put no more than £12,000 of that into a cash ISA.
From 6 April 2027 tax rates on savings interest will rise to 22%, 42% and 47%, and on rental income also to 22%, 42% and 47% (except in Scotland). Dividend tax already went up by 2 percentage points on 6 April 2026.
The FIG regime: 4 years without tax on foreign income for new residents
A new resident who has not been UK tax resident for the 10 years before arriving can pay no UK tax on foreign income and gains for 4 years, even when that money is brought into the country. The regime has applied since 6 April 2025 and is called the FIG regime (Foreign Income and Gains).
It replaced non-dom status, the regime for residents whose domicile, their permanent home in the legal sense, lay outside the UK. For years non-doms paid tax only on money brought into the country (the remittance basis). Now origin and domicile no longer matter: only years of residence do.
| Tool | What it gives | Conditions and cost |
|---|---|---|
| FIG regime | Foreign dividends, interest, rent, profits of a business run abroad and foreign capital gains are untaxed for 4 tax years | 10 consecutive years without UK residence before arrival; in each year of the claim the £12,570 personal allowance and the £3,000 capital gains allowance are lost |
| Overseas Workday Relief | Pay for days worked outside the UK is not taxed | Same 4 years, capped at £300,000 and at 30% of total employment income for the year |
| Temporary Repatriation Facility | Former non-doms' accumulated foreign income is taxed at a reduced rate | 12% in 2025/26 and 2026/27, 15% in 2027/28 |
| Inheritance tax for long-term residents | Not a relief but a boundary: until residence reaches 10 of the last 20 years, only UK assets are in scope | After 10 years out of 20, 40% on assets worldwide; after leaving, exposure continues for 3 to 10 years |
The relief is claimed on the annual Self Assessment tax return, and it can be applied source by source. The four years run consecutively from the first year of residence, whether or not the relief is used, and cannot be saved for later. Leaving the UK and losing residence during that window does not bring the missed years back.
Worked example: dividends and rent from abroad
An entrepreneur moves to London on a Global Talent visa, lives on £150,000 a year of foreign dividends and lets out a flat abroad for £20,000. With a FIG claim, the UK tax on that £170,000 in the first 4 years is zero, even if the money lands in a London bank account. Tax in the source country does not go away: it is withheld there under local rules. In year five the same income is taxed at UK rates: dividends up to 39.35%, rent on the income tax scale up to 45%.
What the regime does not cover
FIG does not cover pay for work done in the UK, which is taxed from day one. Nor does it shelter crypto: in HMRC's view, set out in its Cryptoassets Manual (section CRYPTO22600), exchange tokens are located where their owner is resident. For a UK resident, bitcoin is a UK asset, and gains on it are taxed as UK gains wherever the wallet sits.
FIG also leaves inheritance tax untouched. Until 10 years of residence, UK inheritance tax reaches only UK assets; after that threshold it reaches the whole estate. Families planning to stay longer are better off thinking through how assets are held before the move. The visas that lead down this path are covered on our pages about UK residence by investment and what replaced the investor visa.
Let us check where you pay tax
Three questions in the chat show where you are tax resident.
Corporation tax and dividends: what a UK Ltd pays
A UK company with profits up to £50,000 pays 19% Corporation Tax, and one with profits above £250,000 pays 25%. In between, marginal relief applies, and every pound of profit between the two thresholds is effectively taxed at 26.5%. The government has already fixed the same rates for the financial year starting 1 April 2027.
The most common business form is the Ltd (private limited company), roughly the UK equivalent of an LLC. It is registered at Companies House, the state register of companies. Corporation Tax is paid by UK companies on all their profits and by foreign companies on the profits of a UK permanent establishment.
| Annual profit | Rate | Tax |
|---|---|---|
| £50,000 | 19% | £9,500 |
| £100,000 | 25% less marginal relief | £22,750, or 22.75% |
| £250,000 and above | 25% | £62,500 on £250,000 |
The £50,000 and £250,000 limits are divided by the number of associated companies under common control worldwide. With two companies under the same owner, the lower limit for each drops to £25,000.
How dividends are taxed
The UK levies no withholding tax on dividends: the company pays them out in full. The resident shareholder pays tax on their own scale: 10.75% within the basic rate band, 35.75% within the higher rate band and 39.35% above £125,140. The first £500 of dividends a year is tax-free.
Worked example: £100,000 of profit, all paid as dividends
| Step | Amount, £ |
|---|---|
| Company profit | 100,000 |
| Corporation Tax after marginal relief | 22,750 |
| Dividend to the owner | 77,250 |
| Dividend tax (no other income) | 13,644 |
| Left with the owner | 63,606 |
The total burden is about 36%. In practice owners often combine a modest salary with dividends, but the right balance depends on contributions, pension payments and other income, and it has to be worked out on real numbers.
Company deadlines and penalties
The Corporation Tax return is due within 12 months of the end of the accounting period, but the tax is due earlier: 9 months and 1 day after it. Companies with profits above £1.5 million pay in quarterly instalments. A private company files its annual accounts with Companies House within 9 months of its financial year end. From 1 April 2026 penalties for a late return doubled: £200 straight away and £400 if it is more than 3 months late.
Owners who remain Russian tax residents also face Russian controlled foreign company reporting for a UK Ltd; Murblz specialists prepare CFC notifications and reports separately. Murblz specialists set up a UK Ltd with a working office on a turnkey basis from £5,170, and help separately to open a business account.
What is the UK VAT rate and when to register
A UK business does not have to register for VAT until its turnover over 12 months exceeds £90,000, about 119,000 US dollars. That is higher than any EU country is allowed to set: EU rules cap such thresholds at 85,000 euros. A foreign company selling to private customers in the UK gets no threshold at all: it has to register from its first sale.
The standard VAT (Value Added Tax) rate is 20% and has been since 4 January 2011. The seller adds the tax to the price and pays over the difference between VAT on its sales and VAT paid to its suppliers.
| Rate | What it applies to |
|---|---|
| 20% | Most goods and services, and since 1 January 2025 private school fees |
| 5% | Domestic fuel and power, children's car seats, some residential property works |
| 0% | Most food, children's clothes, newspapers |
| 0% temporarily | Domestic electricity in England, Scotland and Wales from 1 October 2026 to 31 March 2027; Northern Ireland stays at 5%, and gas stays at 5% across the UK |
| Exempt | Postage stamps, financial services, most property transactions |
The difference between zero-rated and exempt matters. With a zero rate, a business recovers the VAT it paid to suppliers; with an exemption it cannot, and that tax becomes a cost.
When to register
Registration is due within 30 days of the end of the month in which turnover for the previous 12 months went over £90,000. If turnover is expected to exceed £90,000 in the next 30 days alone, registration is due by the end of that period. A business can deregister if turnover for the next 12 months is expected to fall below £88,000. Overseas sellers, including online services, that sell to private customers in the UK must register regardless of turnover.
VAT returns are usually filed quarterly through Making Tax Digital: the tax is calculated in compatible software and sent straight to HMRC, with no paper returns. Late filing earns penalty points, and once the points limit is reached, a cash penalty.
We will calculate your taxes online
The chat will ask about your income and residence and send the estimate.
How much sole traders, freelancers and IT companies pay in the UK
The UK has no simplified tax for small businesses. A sole trader pays the same 20-45% income tax as an employee, plus 6% contributions on profits between £12,570 and £50,270 and 2% above that. The difference from a salary lies elsewhere: tax is charged on profit after expenses, and the sole trader pays it directly through a tax return.
The first £1,000 a year of income from side work or small-scale trading is tax-free (the trading allowance). Anything above that means registering for Self Assessment by 5 October after the end of the tax year in which the income arose, and receiving a UTR (Unique Taxpayer Reference), a personal taxpayer number.
| Feature | Sole trader | Ltd company |
|---|---|---|
| Tax on profit | Income tax at 20%, 40% or 45% | Corporation Tax at 19-25%, then dividend tax for the owner |
| Contributions | 6% and 2% on profits (Class 4); voluntary £3.65 a week to build a state pension record if profits are below £7,105 | 8% and 2% on a director's salary, 15% paid by the company |
| Liability | All personal assets | Limited to the company's capital |
| Privacy | Business details are not published | Owners, directors and accounts are visible on the Companies House register |
| Reporting | Annual tax return; from 2026 quarterly updates for some sole traders | Corporation Tax return, annual accounts, yearly confirmation of register details |
Quarterly reporting from 2026
From 6 April 2026 sole traders and landlords with income above £50,000 a year must keep digital records and send HMRC quarterly updates under Making Tax Digital. The threshold falls to £30,000 from April 2027 and to £20,000 from April 2028. The annual return stays.
Freelancers and remote workers
The UK has no digital nomad visa and no special tax regime for nomads. A resident freelancer pays tax as a sole trader, and a remote employee of a foreign company who lives in the UK pays UK tax on their salary even if the employer and the bank account are abroad. The FIG regime does not cover foreign employment income; in the first 4 years only the relief for days worked abroad helps.
IT companies and start-ups
There is no special rate for IT, but several reliefs do cut the bill:
| Relief | What it gives |
|---|---|
| R&D (research and development) tax credit | 20% of qualifying research and development spend; loss-making, R&D-intensive companies get an additional deduction of 86% of spend |
| Patent Box | An effective 10% tax rate on profits from patented inventions |
| SEIS (Seed Enterprise Investment Scheme) | Investors cut their income tax by 50% of the amount invested, up to £200,000 a year |
| EIS (Enterprise Investment Scheme) | 30% of the investment off income tax, up to £1 million a year, or £2 million for knowledge-intensive companies |
Founders with an idea should read what replaced the UK Start-up visa and our guide to the Global Talent visa.
Taxes on property, inheritance, cars and crypto
A £500,000 flat in London costs a local first-time buyer £10,000 in stamp duty, and a non-resident who owns a flat in another country £50,000. The five-fold gap comes from two surcharges that buyers from abroad often discover only once the deal is under way.
Stamp Duty Land Tax (SDLT) is paid on property purchases in England and Northern Ireland. Scotland has LBTT (Land and Buildings Transaction Tax) instead and Wales has LTT (Land Transaction Tax), each with its own rates. The tax is charged on slices of the price, like a progressive scale.
| Slice of the home's price | Standard rate | Additional home |
|---|---|---|
| Up to £125,000 | 0% | 5% |
| £125,001-250,000 | 2% | 7% |
| £250,001-925,000 | 5% | 10% |
| £925,001-1,500,000 | 10% | 15% |
| Over £1,500,000 | 12% | 17% |
The 5% surcharge on additional homes applies if the buyer already owns a home anywhere in the world and the new one does not replace a main residence sold (within 36 months). Non-residents pay a further 2%; for this surcharge residence is measured by a separate rule, based on days in the UK around the purchase date. First-time buyers pay nothing up to £300,000 and 5% on the slice from £300,000 to £500,000; above £500,000 the relief does not apply.
Worked example: a £500,000 flat
| Buyer | Stamp duty, £ |
|---|---|
| First-time buyer, UK resident | 10,000 |
| UK resident, only home but not the first ever | 15,000 |
| Non-resident, owns no other home anywhere now, not a first-time buyer | 25,000 |
| Non-resident who owns a flat in another country | 50,000 |
A company buying a home for more than £500,000 usually pays 17% on the whole price unless a relief applies, for example for a genuine property rental business. On top comes the annual ATED (Annual Tax on Enveloped Dwellings), the tax on homes owned by companies: in 2026/27 it is £4,600 for a property worth £500,000 to £1 million and £9,450 for one worth £1 million to £2 million.
Council Tax and the charge on expensive homes
Council Tax is the local tax paid by occupiers. The local council sets the amount by the home's valuation band, and a home with a single adult occupant gets a 25% discount. Under plans announced in the 2025 Budget, from April 2028 owners of homes in England worth more than £2 million will pay a surcharge on top of Council Tax (the High Value Council Tax Surcharge): from £2,500 a year for a home worth £2 million to £2.5 million up to £7,500 for one worth over £5 million.
Rental income
Rent is taxed at normal income tax rates. Mortgage interest is not deducted from rental income; instead there is a tax credit at the 20% basic rate, rising to 22% from April 2027. If the landlord lives abroad, the letting agent or the tenant (where rent is over £100 a week) withholds 20% under the Non-Resident Landlord Scheme until HMRC approves receiving rent in full. For a yielding property, see our section on UK investment property.
Capital Gains Tax
Gains on shares, a business, a second home or crypto are subject to CGT (Capital Gains Tax) at 18% within the basic rate band and 24% above it. The annual exempt amount is just £3,000 of gains. Selling one's own main home is usually tax-free. On the sale of a business under Business Asset Disposal Relief the rate from 6 April 2026 is 18%, up from 14% in 2025/26.
Non-residents pay UK capital gains tax on sales of UK property. Any such sale, even without a gain, must be reported and the tax paid within 60 days of completion.
Inheritance Tax
IHT (Inheritance Tax) is charged at 40% above the £325,000 nil-rate band, about 430,000 US dollars. When a home passes to children or grandchildren, a further £175,000 is added, but for estates above £2 million this extra band tapers away. Gifts are taxed if the donor dies within 7 years of making them. All thresholds are frozen until 5 April 2031.
| What changed | From | What it means |
|---|---|---|
| Long-term residence replaces domicile | 6 April 2025 | After 10 years of residence out of the last 20, tax applies to assets worldwide |
| Agricultural and business assets | 6 April 2026 | Full relief only for the first £2.5 million per estate, 50% relief above that; spouses can pass unused allowance to each other |
| Pension savings | 6 April 2027 | Unused pension savings become part of the estate |
The 2025 Budget set the allowance at £1 million; on 23 December 2025 the government raised it to £2.5 million, and that figure was written into the Finance Act 2026, which received Royal Assent on 18 March 2026. Transfers between spouses are exempt, but if the recipient is not a long-term resident while the donor is, the exemption is capped at £325,000.
Vehicle tax
VED (Vehicle Excise Duty) is the annual road tax. For cars registered from 1 April 2017 the first-year rate runs from £10 to £5,690 depending on CO2 emissions, then £200 a year. If the car's list price was over £40,000, a further £440 a year is added for five years; for electric cars registered from 1 April 2025 the threshold has been £50,000 since 1 April 2026. Electric cars have paid VED since April 2025, and from April 2028, under government plans, they will also face a per-mile charge.
Crypto
There is no separate crypto tax. Selling or swapping crypto is taxed as a capital gain at 18% and 24%, and income from mining and staking is generally subject to income tax. Since 1 January 2026 UK crypto platforms have been collecting customer and transaction data under the international CARF standard (Cryptoasset Reporting Framework, the crypto information exchange system developed by the OECD) and passing it to HMRC.
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Is there a UK-Russia double tax treaty and what non-residents pay
In practice there is no longer a double tax treaty between the UK and Russia: since 2025 neither side applies it. Russia suspended almost all of its articles by Presidential Decree No. 585 of 8 August 2023, and the UK responded in kind by suspending the convention in full.
The Double Taxation Relief (Russian Federation) (Revocation) Order 2025 (SI 2025/344), made on 12 March 2025, stripped the convention signed on 15 February 1994 of effect in UK law: from 1 April 2025 for Corporation Tax and from 6 April 2025 for income tax and capital gains tax. Formally the treaty has not been terminated, but it no longer reduces rates, allocates taxing rights or settles residence disputes.
What this means in practice. A UK tax resident with Russian income pays tax in both countries and can credit the Russian tax in the UK only under the UK's domestic unilateral relief rules, and no more than the UK tax on the same income. A dual residence dispute cannot be resolved under the treaty: each country applies its own rules. In the first 4 years the FIG regime removes part of the problem: foreign income, if the regime is claimed, is not taxed in the UK. The UK suspended its treaty with Belarus in the same way from 2025 (SI 2025/345).
| Country | Treaty status | UK tax on interest / royalties under the treaty |
|---|---|---|
| Russia | Suspended since April 2025 | Not applied, domestic 20% / 20% |
| Belarus | Suspended since April 2025 | Not applied, domestic 20% / 20% |
| Ukraine | In force since 11 August 1993, 2017 protocol since 5 December 2019 | 5% / 5% |
| Kazakhstan | In force | 10% / 10% |
| Georgia | In force | 0% / 0% |
| Armenia | In force | 5% / 5% |
| Cyprus | In force | 0% / 0% |
A UK resident's Ukrainian income is fully protected by the treaty with Ukraine: it allocates taxing rights between the two countries and allows Ukrainian tax to be credited. HMRC publishes the full list of treaties on gov.uk.
What taxes non-residents pay
A non-resident pays UK tax only on UK income. Much of it is withheld at source:
| A non-resident's UK income | How it is taxed |
|---|---|
| Dividends from UK companies | No withholding tax, except distributions by property funds (REITs) at 20% |
| Interest | 20% at source, 22% from 6 April 2027, unless a treaty lowers it |
| Royalties | 20% at source, unless a treaty lowers it |
| Rent from UK property | 20% withheld by the agent or tenant, final bill settled on the annual return |
| Sale of UK property | Capital gains tax at 18% or 24%, reported within 60 days |
| Pay for work done in the UK | Income tax and contributions through the employer |
A non-resident gets the £12,570 personal allowance only as a British or European Economic Area citizen, after working for the UK government during the year, or where a treaty with their country of residence grants it. Murblz specialists help to open a personal UK bank account to receive such income.
When to file a UK tax return and what the penalties are
The key date in the UK tax calendar is 31 January. That is the deadline for the online return for the previous tax year and for paying the balance of tax, and filing even one day late costs a £100 penalty, even if there is nothing to pay.
Not everyone has to file a Self Assessment return. An employee with a single salary taxed through the employer usually does not. A return is needed for sole trader income, rent, foreign income, gains above the annual exemption, a FIG claim, or when HMRC asks for one.
| What | Deadline |
|---|---|
| Registering for Self Assessment | By 5 October after the end of the tax year in which the income arose |
| Paper tax return | By 31 October after the end of the tax year |
| Online tax return and balancing payment | By 31 January after the end of the tax year |
| Payments on account for the next year | 31 January and 31 July |
| Reporting and paying tax on a sale of UK property | 60 days after completion |
| Making Tax Digital quarterly updates for sole traders and landlords | Every quarter, from 6 April 2026 for income above £50,000 |
| Corporation Tax: payment | 9 months and 1 day after the end of the accounting period |
| Corporation Tax: return | 12 months after the end of the accounting period |
| VAT | Usually quarterly |
For the 2025/26 tax year, which ended on 5 April 2026, that means a paper return by 31 October 2026 and an online return by 31 January 2027.
Late filing and payment penalties
| Breach | Penalty |
|---|---|
| Return filed late | £100 straight away |
| More than 3 months late | Plus £10 a day, up to £900 |
| 6 and 12 months late | Each time a further 5% of the tax due or £300, whichever is greater |
| Tax unpaid after 30 days, 6 months and 12 months | Each time 5% of the unpaid amount |
| Late payment interest | Bank of England base rate plus 4 percentage points a year since 6 April 2025 |
| Company return filed late | £200, or £400 if more than 3 months late, from 1 April 2026 |
Inaccuracy is punished separately: if tax is understated through carelessness or deliberately, the penalty is a percentage of the shortfall, and the more serious the breach, the higher it goes. Sole traders and landlords under Making Tax Digital, and VAT-registered businesses, are on a points-based system: each late submission earns a point, and hitting the limit triggers a penalty.
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Who the UK tax system suits and who it does not
The British tax system is generous to newcomers and tough on long-stayers. For the first four years foreign capital can remain almost untouched by UK tax, yet after ten years of residence all of it falls within the 40% inheritance tax. Whether the move pays off depends on how long it is planned for and what income comes with it.
It suits owners of foreign capital, dividends and rental income who have not been UK resident for 10 years: that income is untaxed in the UK for 4 years. Professionals on a UK salary up to £100,000: the tax is transparent, withheld by the employer, and often no return is needed. Start-up founders and their investors: SEIS and EIS reliefs, the R&D credit and the Patent Box noticeably lower the burden.
It does not suit holders of large crypto portfolios: the FIG regime does not reach them. Salaries between £100,000 and £125,140: on that stretch every pound is taxed at an effective 62%. Families planning to stay more than 10 years with capital abroad and no ownership structure thought through in advance: the 40% inheritance tax will reach worldwide assets and follow them for up to 10 years after leaving. Russian tax residents with income in both countries: the treaty is suspended, and double taxation is only partly relieved.
What to do before moving
| Step | Why |
|---|---|
| Check for any UK residence in the last 10 years | It decides eligibility for the 4-year FIG regime |
| Choose the moving date with the tax year (6 April) in mind | Split year rules can keep income before arrival out of UK tax |
| Deal with crypto and large transactions | After arrival, crypto gains are taxed in the UK with no FIG relief |
| Work out stamp duty before buying a home | A flat in another country adds 5%, non-resident status another 2% |
| Check tax residence in the country being left | Without a treaty, dual residence is settled only under each country's domestic rules |
The next UK Budget is set for 28 October 2026, and the government has already ruled out raising the rates of income tax, employee National Insurance and VAT. How will the Budget affect your major transaction? Ask an expert.
Tax is only one part of a move. Visa options are collected on our United Kingdom page, and the road to a passport in our guide to UK naturalisation. If the move needs a company in another jurisdiction, Murblz specialists help with company formation abroad, and the legal side of relocation is handled by Murblz legal support.
FAQ
What taxes do you pay in the UK in 2026?
How much tax is taken from a salary in the UK?
How many days in the UK make you a tax resident?
What taxes do non-residents pay in the UK?
Is the UK-Russia double tax treaty still in force?
What is the UK FIG regime and who can use it?
What is the UK VAT rate and when do you have to register?
What taxes do Ukrainians pay in the UK?
Services
Murblz services in the United Kingdom
The tax rate is only half the picture. The other half is where the company sits, where the money is held and who files the accounts. Murblz specialists help with that in the same country. The quote is fixed in writing before work starts.
See also
Related programs and destinations
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