We talk to a businesswoman, TV personality, academic and author about her annoyance, and frustrations, about the changes to the non-domicile system, and what she thinks needs to be done instead to attract tax revenue and business to the UK.

There has been a torrent of coverage for the past year about the UK ending the resident non-domicile system. One shouldn’t forget that even before the UK Labour Party took office exactly a year ago, the former Conservative Party-led government had pledged a similar move, albeit arguably less harsh in its impact.

Lawyers, accountants and private client advisors, along with think tanks and economic research groups have explained the impact and the exodus of thousands of HNW individuals from the UK. In this context, however, it is easy to overlook the human angle.

For Dr Ann Kaplan Mulholland (main picture), a television personality, financial sector businesswoman, UK hospitality venue owner, author and academic, the disruption to her life and that of her family from what has happened is all too real.

“When I am in the UK I am working every day. I am not going to quit,” she told WealthBriefing in a call. She's off to Italy next year but will remain involved with her UK business as much as possible.

“Everyone I have spoken to is leaving [the country]," she said.

Dr Kaplan owns Lympne Castle in Kent, which is used for events such as weddings and other celebratory events, and has several other properties in the UK. In total, Dr Kaplan employs about 100 people. 

She told WealthBriefing that her move from the UK to Italy won’t affect those employees: “These are people’s jobs, their careers. We will continue to operate the castle and grow the business.”

The choice of Italy was affected by a number of factors. The European Union member state introduced a residency system before the pandemic, which now charges €200,000 ($234,410) per year. 

“We have completed the application to reside in Italy,” she said. The process means that she will be out of the UK from 6 April 2026 and will only spend 90 days out of a calendar year in the UK from that point. She also looked at options in Dubai, Switzerland, the Bahamas and Malta.

She’s unhappy at having to make the change: “The UK would have to be our first choice and still is.”

Other non-doms who have quit or are considering leaving the UK are reportedly frustrated and believe the change will be a net blow to the UK. 

John Fredriksen, who at one point was the UK’s ninth-richest man and owner of expensive property in London, has reportedly said he is now living in the United Arab Emirates. He is worth an estimated $13.6 billion (Daily Telegraph, 27 June). “The entire Western world is on its way down, while the UK is “starting to remind me more and more of Norway. Britain has gone to hell, like Norway,” he said. (Norway has a wealth tax of up to 1.1 per cent, applying also to worldwide wealth.)

There have been reports that UK Chancellor Rachel Reeves is considering a partial U-turn, for instance whether inheritance tax – which is set at 40 per cent on estates of more than £325,000 ($444,728) – should apply to worldwide assets of non-doms. As one of the highest inheritance levies in the world, it is seen as the “final straw” for many non-doms. (See an earlier story here.)

Shrinking tax base
At stake is the UK’s tax base. In an almost textbook illustration of the “supply-side” argument about how tax rates can, at a certain level, reduce rather than raise revenues, figures show that more that 16,500 HNW individuals – those with at least $1 million in net investable wealth – are due to quit the UK this year.

People are – like Dr Kaplan – heading to the likes of Italy; other destinations include Portugal and the UAE. Even the US, with its worldwide tax code, could have a “golden card” system for HNW individuals (although the US tax system might prove problematic in the medium term). 

Think tanks such as the Adam Smith Institute (see here) and the Centre For Economic and Business Research (CEBR) (see here) say that, depending on how sharply the changes bite, it will shrink tax revenues, rather than increase them.

While some non-doms are planning to quit – there are possibly around 60,000 who haven’t yet hit the exits – jurisdictions are watching to see if they can collect new business. 

“Many people were already well-prepared and were ready to act but didn’t make the jump too quickly just in case there was some economic literacy in the government. But the opportunity for political grandstanding trumped the easily-foreseeable economic reality,” Paul Gorman, CEO of Guernsey-based Bank Aston said in a note.

“These individuals and funds leaving the UK have to take their money somewhere, and more and more are sensibly turning to offshore locations like Guernsey,” he said. 

Pali Banwait, founder of Strive Consultants, said an issue is not just the number of non-doms leaving the UK, but there are people choosing not to come to the country in the first place.

“Much of the focus has been on a so-called millionaire exodus, but what about the wealthy individuals now choosing not to move to the UK at all? The impact of policy isn’t just who leaves, it’s who never comes. That reality may finally be hitting home. Estimates suggest another 9,500 millionaires could leave the UK in 2025, on top of the 10,800 who left last year. For context, that number was just 4,200 in 2023,” Banwait said. 

So far, Reeves hasn’t spelled out whether the government is prepared to change course, and if it did, it would come at a time when the administration has already made politically controversial changes such as the limitation of winter fuel allowances and disability payments.

A colourful story
Dr Kaplan’s own story is one of the more eye-catching ones. She works in finance with a focus on consumer credit scoring (predictive scores for consumer loan risk). She founded iFinance, a North American consumer fintech company – taking it from a startup in 1996 to one of the largest consumer finance companies in Canada with loan applications exceeding C$2 billion ($1.46 billion). One of the more colourful examples of a non-dom, she stars in a “docureality” TV show, Queen of the Castle, and was one of the stars of The Real Housewives of Toronto. To add to all that, Dr Ann Kaplan has a doctorate, an MSc and MBA in finance. 

Her husband, Stephen, is Irish, her mother was English, and she was raised by a Scotsman, although her biological father was Hawaiian.

Dr Kaplan has written six books, is a regular speaker on the public speaking circuit, and is active in the fashion scene. She was twice recognised as the Canadian Women Entrepreneur of the Year, she also received the Award of Excellence for Canada as the recipient of the top honour. She holds a DBA (Doctor of Business Administration), an MBA, Master of Science (MSc) and a Corporate Governance Designation (CD.D).

Reform ideas
Dr Kaplan argued that the replacement system for the non-dom system – a residency regime with a four-year pause to tax on foreign income and gains (FIG) isn’t adequate. 

The four-year period of no tax under the new residency system is too short – to develop a business such as Dr Kaplan’s Lympne Castle venue, for example, takes many years to renovate and to grow (the business), she said.

“The short four-year term, taxation and inheritance tax on foreign assets are each a reason that make the UK an unattractive consideration for wealthy foreigners to live and invest in,” Dr Kaplan said.

“Rachel Reeves should not be charging tax on worldwide assets either or shortening the length of stay to four years. If Reeves does not want the economy to be hit further, she should re-consider the piecemeal suggestions,” she continued. 

“The decision to scrap the non-dom tax regime should be reversed with a consideration for a tiered system, or fee similar to other countries. Just implementing the fee will solve the budget issues – consider a £200,000 fee per annum, that would bring a minimum of £12.5 billion per annum (plus the £8.9 billion we pay in taxes) directly to the UK,” she said.

An Italian-style annual fee system would make more sense for the UK, she said.

Dr Kaplan added that wealth managers must be “brutally honest” with clients about what’s at stake.