Icelandic investor Thor Bjorgolfsson, whom Forbes named as Iceland's first billionaire in 2005, has ceased to be a British taxpayer. He has transferred his tax residency to Italy and relocated his investment fund Novator's headquarters from London to Zurich. He shared this in a Bloomberg interview published in July 2025. According to Bjorgolfsson, the non-dom regime was ready for changes — but Britain will now face serious difficulties in attracting wealthy individuals.
What is non-dom and why it was abolished
The "non-domiciled resident" regime operated in Great Britain since colonial times: a foreign resident paid British taxes only on income earned within Britain itself. Wealth earned abroad remained beyond the reach of HMRC — provided it was not brought into the country. The Labour government abolished this system on April 6, 2025, replacing it with a residential model featuring a four-year tax break window for new arrivals and a 40-percent inheritance tax on foreign assets.
According to HMRC data, in 2022–23 Britain had 74,000 non-dom residents, of which 37,800 paid a fixed annual levy to maintain protected status. The government expected to receive £2.5 billion annually from the reform.
Who has already left — and what the numbers show
Bjorgolfsson is not an exception. He is part of a trend that analysts are already tracking statistically. According to Henley & Partners and analytics firm New World Wealth, in 2024 Britain was left by 10,800 millionaires — 157% more than the year before. Among them were 78 individuals with assets exceeding £100 million and 12 billionaires, according to The Times citing New World Wealth.
Forecasts suggest that in 2025–2026, another 16,500 wealthy residents could leave the country, with a combined liquid capital of approximately $91.8 billion.
"If all those seriously considering leaving actually do go, the £2.5 billion in expected revenues will turn into a minus £1 billion"
— Risk Assured report based on Oxford Economics survey of 700 non-dom residents or their tax advisors, January 2025
The Adam Smith Institute went further in April 2025: according to their calculations, abolishing the non-dom regime could cost Britain up to £111 billion by 2035 and up to 44,000 jobs by 2030. The share of millionaires in the British population could decline by 20% by 2028.
A telling detail: analysts at the Centre for Economics and Business Research calculated that if just 25% of non-dom taxpayers with preferential status leave the country — the net budget gain will be zero.
Where they're going — and why there
Bjorgolfsson chose Italy not by chance. Rome offers its own non-dom regime: a fixed annual tax on all foreign income regardless of amount. For those who relocated by August 2024, it is €100,000 per year; for those who arrived later, €200,000; from 2026 the rate will increase to €300,000. The regime lasts up to 15 years and exempts foreign assets from property and inheritance taxes.
Britain also faces competition from the UAE — the expected leader in attracting millionaires in 2025 with projected growth of around 10,000 individuals — as well as Portugal and Greece. The USA expects an increase of 7,500 wealthy residents with $43.7 billion in capital.
- Italy — fixed tax of €200–300k/year on foreign income, 15 years, no inheritance tax on foreign assets
- UAE — absence of income tax, record capital inflow in 2025
- Switzerland — flat-rate taxation based on living expenses, not income
Where the real conflict lies
Labour proceeded from a position of fairness: a system that allowed billionaires to live in London and not pay taxes on offshore income seemed intolerable against the backdrop of social spending cuts. The argument is justified. The problem lies in miscalculating the scale of behavioral response. Every relevant analysis, including the Oxford Economics survey, showed that roughly two-thirds of non-dom residents considered leaving as a serious option. The government either underestimated this or consciously accepted losses for a political signal.
Notably, even Bjorgolfsson — a person who left — publicly acknowledges that the regime needed reform. His objection is not to the principle but to calibration: abruptly imposing a 40-percent inheritance tax on global assets without a transitional mechanism is not reform but a confiscatory signal.
London's response so far amounts to cosmetic amendments to the FIG (Foreign Income and Gains) regime, which provides four-year benefits to new residents. According to surveys, most advisors consider it insufficient to reverse the trend.
If the Starmer government does not propose a structurally competitive alternative before the next budget cycle — the question will no longer be whether the outflow continues, but whether London will remain a capital management hub for the next generation of investors like Bjorgolfsson, who have not yet decided where to settle.
