With the first year of the UK’s new 4-year Foreign Income and Gains (“FIG”) regime drawing to a close on 5 April 2026, individuals who have recently relocated to the UK should consider both the availability of the relief and how to maximise its benefits during the FIG regime period.

What is the FIG regime?

The FIG regime was introduced from 6 April 2025 and may be claimed by any individual who relocates to the UK after at least 10 consecutive years of non-UK tax residence. Where these conditions are met, the individual can access a 100% exemption from tax in the UK on qualifying foreign income and gains (“FIG”) arising in their first year of UK tax residence and the following three tax years.

Individuals who claim the relief will forfeit their UK personal allowance for income tax purposes and their annual exempt amount for capital gains tax. As a result, the regime will not be beneficial in all circumstances.

What are the conditions for FIG relief?

The FIG regime is available to “qualifying new residents”. An individual will be a qualifying new resident if they:

  1. Are UK tax resident under the statutory residence test (“SRT”);
  2. Relocated to the UK after 10 consecutive tax years of non-UK tax residence; and
  3. Are in their first tax year of UK residence or one of the following three tax years.

To rely on this relief, a claim must be made in the individual’s self-assessment tax return by the first anniversary of the normal filing deadline (i.e. 12 months after the 31 January following the end of the relevant tax year).

Pre-5 April 2026 considerations

For individuals who are able to benefit from this relief in 2025/26 and may wish to make a claim on their self-assessment tax return for the year, consideration should be given to:

  • Reviewing historic UK tax residence position to confirm eligibility
  • Collating detailed records of foreign income and gains in respect of which a claim will be made, as these amounts must still be disclosed on the tax return.
  • Tax planning opportunities may include (subject to personal circumstances):
    - acceleration of foreign gains into the exemption period
    - “rebasing” of investments by selling and repurchasing (subject to the bed and breakfasting rules)
    - declaring dividends from personal companies in the exemption period
    - acceleration of offshore-trust distributions to beneficiaries
    - minimising UK income producing investment during the exemption period 
  • Consider any further tax benefits that may be available under the terms of a double taxation agreement.

For assistance or advice on these new rules or your UK tax position in general, please contact us.