UK Is Losing Its Millionaires Because Of Taxes, Political Turmoil - Where Are They Going?

A combination of the long-term consequences of Brexit and the unstable political climate in the country ahead of the July 4 elections has resulted in an exodus of millionaires from the United Kingdom in favour of "haven" countries. This is according to the latest data from a report from Henley, a consultancy firm that tracks migration trends.

The "Henley Private Wealth Migration Report" report notes that the United Kingdom experienced a net loss of 9,500 high-net-worth individuals in 2024 — more than double last year's figure of 4,200 (which was a record-high figure). The UK ranks second in countries with the most significant number of millionaire exodus–with China ranking first at 15,200. Following the UK in the departure are India (4,300), South Korea (1,200), and the Russian Federation (1,000).

Where Is Everyone Moving And Why?

According to the report, most UK millionaires who have left the country get absorbed by European neighbours–specifically Italy, Switzerland, Greece, and Portugal. As mentioned earlier, this is due to the countries' retaining the status of their non-domicile residents. For context, a non-domicile–or shortened to non-dom–refers to a resident whose permanent home, or domicile, is outside their registered tax address for tax purposes.

It is worth noting that this exodus followed a decision by Conservative Chancellor Jeremy Hunt to appropriate a long-standing policy of the opposition Labour Party by abolishing the non-dom status. Following this, several non-domicile wealthy personalities have left the United Kingdom to avoid getting taxed by the UK on their overseas income.

"We did have one billionaire client who literally on the day of the budget, March 6, got on his private jet with his wife, with his children, with the private tutor, and flew to one of his other 17 houses in the world – and said 'I'm not coming back," John Barnett, a partner at the law firm Burges Salmon told The Guardian recently.

The Henley report added that as the London Stock Exchange continues to slip against its competitors in New York, Singapore, and elsewhere in Europe, negative headlines about Britain's ageing infrastructure, notably its sewage, transport, and health systems, have not helped.

A History Of Deteriorating Systems And Credibility Loss

One of the most significant factors that have affected the massive exodus of wealthy non-doms from the UK is that they were targeted with additional taxes, prompting many of them to leave the country. Moreover, the growing dominance of the USA and Asia in the global hi-tech space has caused several wealthy UK tech entrepreneurs to reconsider their base location.

"Capital gains tax and estate duty rates in the UK are among the highest in the world, which deters wealthy business owners and retirees from living there. These taxes also spill over the local wealth management and family office sector, showing signs of decline," notes Andrew Amoils, the head of research at wealth intelligence firm New World Wealth.

It is also worth noting that during the six years from 2017 to 2023 post-Brexit, the UK has lost 16,500 millionaires to migration. Provisional estimates for 2024 are even more concerning, with a massive net outflow of 9,500 millionaires projected for this year alone. For international destinations, the top cities many wealthy UK non-doms go to as well include Paris, Dubai, Amsterdam, Monaco, Geneva, Sydney, and Singapore, as well as retirement hotspots such as Florida, the Algarve, Malta, and the Italian Riviera.

Meanwhile, Dr. Hannah White OBE, the director and CEO of the Institute for Government in London, notes that continued political instability has also contributed to this billionaire exodus. It is worth noting that it started with Boris Johnson's leadership and a scandal-driven resignation transition–followed by a short-lived Liz Truss premiership then with Rishi Sunak's leadership, which resulted in a lack of policy space to address the structural factors impeding the UK economy that has contributed to an uncertain investment climate.

Dr. White added that over 7% of the 128,000 millionaires projected to move globally in 2024 will choose to depart the UK.

"These figures reflect a steady accumulation of factors detracting from the UK's appeal to high-net-worth individuals. The hangover from Brexit continues to be felt, with the City of London no longer seen as the financial centre of the world, despite efforts to retain city employers with the scrapping of EU rules limiting bankers' bonuses in 2022," she stated.