Why Wealth Is Leaving the UK

Reports of wealthy people leaving the UK have become a fixture of the financial press over the past two years. It is tempting to read every headline as evidence of a country in decline but that would be an overstatement.

According to the International Monetary Fund, the UK’s economy was valued at $4.26 trillion in April 2026, making it the fifth largest economy in the world. It remains a powerhouse of global finance, home to deep capital markets and has a highly educated workforce with 54% of citizens completing tertiary education, again ranking fifth across the globe.

What has changed is the UK's relative attractiveness for wealthy individuals and families. Henley & Partners, a strategic partner of Hoxton Wealth, is a global leader in residence and citizenship planning.

The company recently published its Private Wealth Migration Report 2026, which introduces a new Global Wealth Mobility Framework. The report scores over 30 jurisdictions on their structural attractiveness to internationally mobile wealth, based on factors including tax treatment, rule of law, quality of life, and long-term policy predictability.

The UK was placed among a group the report describes as ‘competitive jurisdictions under pressure,’ alongside Germany, Norway, South Korea, and France. These are some of the world's largest and most established economies, all facing the same underlying issue: it is becoming harder to compete for wealth that can, increasingly easily, choose to be somewhere else

Henley & Partners’ client data illustrates the scale of the shift away from the UK, with applications from individuals with a UK address rising sharply between 2024 and 2025. Indeed, the UK has moved from being a relatively minor source of new client enquiries in 2018 to consistently ranking among the firm's largest markets globally in recent years.

Notably, foreign nationals living in the UK now make up around half of all UK-originated applications, up from a small fraction less than a decade ago - suggesting this is as much a story about internationally mobile residents reconsidering the UK as a base, as it is about British nationals leaving outright.

Separate analysis from the Adam Smith Institute, a UK think tank, has attempted to quantify what this means for public finances. Its research estimates that thousands of liquid millionaires left the UK in 2024 alone, equating to a shortfall in income tax revenue of over half a million average taxpayers.

The institute also argues that the true fiscal impact once other taxes are accounted for is far higher.

Maxwell Marlow, the institute's Director of Research, did not mince his words, saying: ‘The rate at which millionaires are leaving the country is alarming. This will have serious implications for our wider economy and the public services which their taxes have been funding.’

Marlow’s broader argument is that if the Exchequer continues to lose high-contributing taxpayers, the gap is likely to be filled by higher taxes on everyone else - a dynamic that, if it plays out, could reinforce the very trend it is responding to.

He is calling for new measures to attract more millionaires to the UK such as an Italian-style flat rate fee or reducing anti-business taxes.

There is not one single cause behind the shift of wealth away from the UK. Instead, a combination of factors is prompting high-net-worth individuals and families to rethink residency and whether they could be better off elsewhere. These include:  

For decades, the UK's non-domiciled status allowed internationally mobile residents to live in Britain while paying UK tax only on income and gains actually brought into the country, with overseas earnings largely shielded.

That regime has now been replaced with a residence-based system, meaning most new arrivals face UK tax on their worldwide income and gains after a short introductory period, much like any other resident.

For entrepreneurs, investors, and business owners whose income and assets sit across several jurisdictions, this represents a fundamental change to what living in the UK actually costs - not a technical adjustment.

Inheritance tax exposure in the UK traditionally hinged on domicile. This changed in April 2025 when the residence-based system was adopted. Long-term UK residence itself can now trigger exposure to inheritance tax on a person's worldwide estate, in some cases persisting for a number of years after someone has left the country.

More changes are being introduced from April 2027, when unused funds in defined contribution pensions will be included within an estate for inheritance tax purposes. This shift means many more families - not just the very wealthy - may face a potential liability.

Given the UK's relatively high headline inheritance tax rate of 40%, and the fact that many competing jurisdictions including Australia, Canada, Singapore, the UAE, Portugal, and New Zealand have no inheritance tax at all while others, like Spain, are actively reducing it, the UK's direction of travel stands out.

While income tax remains the focus of much public debate, Henley & Partners data reveals that capital taxes - inheritance tax in particular - appear to have a greater bearing on whether someone chooses to stay or go.

It is this combination - a widening net catching more families, layered onto rules that keep moving - that is driving wealth away from the UK.

The visa route that once allowed wealthy individuals to secure UK residency in exchange for a qualifying investment was closed in 2022, and no direct replacement has been introduced since.

Its closure matters less for who it kept out and more for what it signals: without an equivalent inbound pathway, the UK has effectively stepped back from active competition for new internationally mobile wealth at the same moment several other jurisdictions – the UAE and Italy among them – have been actively expanding theirs.

Perhaps the hardest factor to quantify is one which Hoxton advisers in the UK frequently hear from their internationally mobile clients: the sense that the rules themselves may not stay still for long.

Successive rounds of tax reform, delivered in relatively quick succession, have made it harder for families to plan with confidence over a five- or ten-year horizon, even where they are not directly affected by any single change.

For decisions with genuinely long-term consequences — where to raise a family, how to structure a succession plan, where a business should be based — that uncertainty can matter as much as the substance of the policies themselves.

An incessantly evolving tax environment has altered how the UK is perceived by the kind of internationally mobile families who once treated Britain as a natural long-term base.

For internationally mobile clients considering a move to or from the UK, a few practical implications stand out:

Domicile and Residence Status Need Regular Review

The rules determining UK tax exposure have changed substantially in a short space of time and continue to evolve. Status that was favourable two years ago may not be today, and vice versa. It’s essential to regularly review the tax landscape with a professional.

A Single-Jurisdiction Plan Carries More Risk Than It Used To

Henley & Partners' report describes a growing trend among wealthy families towards building what it calls a ‘sovereign portfolio’ - spreading residence, assets, and long-term planning across more than one jurisdiction, rather than relying on any single country's rules remaining stable.

Predictability Is Now a Planning Factor In Its Own Right

The UK’s tax treatment today may not still apply in a decade. While none of us have a crystal ball, predictability is increasingly part of the conversation with clients making long-term decisions.

UK Wealth Migration: Understanding the Big Picture

None of this means the UK has become an unattractive place to live, invest, or do business. It means the UK is now competing directly with jurisdictions that have made deliberate, sustained efforts to attract internationally mobile wealth - and that competition is having a measurable effect on where people choose to be.

Understanding why that shift is happening, rather than simply reacting to headlines about it, is the more useful starting point for anyone with a financial plan that touches the UK.

If you have any concerns about the financial planning issues raised in this article, we encourage you to contact your Hoxton Wealth adviser who can discuss them with you.

No adviser? No problem. Get in touch and we’ll connect you with an experienced professional who can help, wherever you are in the