Pre-Immigration Tax Planning: Before You Move Abroad

Introduction

For internationally mobile HNW individuals, the period before departure is perhaps the most financially consequential phase of an international move. Pre-departure tax planning — sometimes called "pre-immigration tax planning" — involves a structured review of your assets, income sources, business interests, pensions, and existing structures to ensure that your transition to a new country of residence is as tax-efficient as possible.

The mistakes made in this period are often expensive and irreversible. Missing a planning window — failing to crystallise a gain, leaving assets in an inefficient structure, or failing to wind up or restructure an arrangement — can result in significantly higher lifetime tax bills. The opportunities missed before departure are generally not available after you arrive.

This guide covers the key pre-departure planning areas for UK tax residents, but many of the principles apply to individuals leaving any high-tax jurisdiction. Always seek specialist tax advice well in advance of departure — ideally 2–3 years before the intended move date. Rules change.

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Step One: Understand What You Are Leaving

Before planning begins, you must map your current position comprehensively:

• All assets: property, investments, business interests, pensions, trusts, insurance bonds, art and collectibles, cryptocurrency.
• All income sources: employment, self-employment, dividends, rental income, interest, trust distributions.
• All existing structures: family companies, trusts, foundations, offshore bonds, partnerships.
• Obligations: mortgage debt, guarantees, contracts, ongoing commercial relationships.
• Existing tax attributes: accumulated losses, pension annual allowance history, available lump sum allowance (the lifetime allowance was abolished from 6 April 2024 and replaced by the Lump Sum Allowance and Lump Sum & Death Benefit Allowance).

This asset and income map is the starting point for pre-departure planning. Each item needs to be assessed against the rules in both your departure country and your intended new country of residence.

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Step Two: Establish Your Target Country's Tax Rules

Pre-departure planning in the departure country must be coordinated with the tax rules in the destination country. The two systems interact:

• A gain crystallised before departure (and potentially taxed in the departure country) will not be taxed again in the arrival country if the base cost in the arrival country is "stepped up" to market value on arrival.
• Conversely, a gain deferred until after arrival may be taxable in full in the new country if that country taxes gains on an arising basis with no step-up.
• Income earned in the departure country's final tax year may be partially exempt in the new country.

This bilateral analysis is essential — departure country planning and arrival country planning must be considered together.

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Capital Gains: Crystallise, Defer, or Rebate?

UK Departure: The Step-Up Opportunity in the New Country

The UK generally taxes gains that have accrued while the individual is UK resident, but once non-resident, the individual is not subject to UK CGT on the disposal of most financial assets (UK residential property is an exception — non-resident CGT applies to UK residential property).

For a move to a country that provides a capital gains step-up on arrival (i.e., the new country uses market value at the arrival date as the base cost for future disposals), it may be advantageous to not crystallise gains before departure. Instead:

• Arrive in the new country as a holder of appreciated assets.
• The new country "resets" the base cost to the arrival market value.
• Future gains (above the arrival-date value) are taxable in the new country; pre-arrival gains are effectively exempt.

Examples of countries that provide a step-up:

• UAE: no capital gains tax — all gains are effectively exempt regardless of when they accrued.
• Qatar, Bahrain: no personal income or capital gains tax.
• Singapore: no personal capital gains tax.
• Switzerland: no federal CGT on private investor assets (cantonal rules vary for real estate).
• Some EU countries: certain EU jurisdictions allow a step-up to arrival market value.

Example: a UK resident holds shares worth GBP 2 million with a base cost of GBP 500,000 (GBP 1.5 million gain). They plan to move to Dubai (no CGT). If they sell before leaving the UK, UK CGT of approximately GBP 360,000 (at the 24% higher rate applying to gains from 6 April 2025) applies. If they sell after arriving in Dubai, no CGT applies. The step-up benefit is approximately GBP 360,000.

When to Crystallise Before Departure

Conversely, crystallising gains before departure makes sense where:

• The destination country levies capital gains tax without a step-up.
• The destination country taxes on worldwide income and gains from arrival.
• The UK CGT rate is lower than the expected rate in the destination country.
• Business Asset Disposal Relief (BADR) is available at a reduced CGT rate (18% for 2026/27, up from 10% to April 2025 and 14% in 2025/26, on gains up to the £1 million lifetime limit) — crystallising in the UK before departure can be significantly cheaper than deferring to a high-tax destination.

Timing: The Year of Departure

The UK CGT annual exempt amount (GBP 3,000 in 2026) and the annual allowance reset mean the year of departure is often the last opportunity to realise a small gain tax-free. For larger gains, the split-year treatment (if applicable) affects which gains are subject to UK CGT.

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Income: Final Year and Residual Income Sources

Employment Termination

A negotiated departure from employment — including any settlement agreement, redundancy payment, or bonus arrangement — should be structured with pre-departure timing in mind:

• UK statutory redundancy payments up to GBP 30,000 are income-tax-free under UK law, regardless of when paid.
• Contractual termination payments above GBP 30,000 are subject to income tax and NICs. Timing the termination date to minimise UK income in the departure year can reduce the tax bill.
• Equity vesting events (options, RSUs, PSPs) around the time of departure require careful analysis — see our guide on Equity Compensation for Mobile Employees.

Rental Income

UK residential property income remains subject to UK income tax regardless of the owner's residence status. Before departure, consider:

• Whether to sell UK rental properties (and any CGT implications).
• Whether to restructure UK property holdings into a company (now generally unattractive given Section 24 mortgage interest restrictions and corporation tax).
• Non-Resident Landlord Scheme registration to receive gross rents.

Trust Distributions

If you are a beneficiary of a UK or offshore trust and expect to receive distributions, the timing of distributions relative to your departure date can significantly affect the tax treatment. Distributing capital before departure from a UK trust avoids a potential mismatch. Taking distributions after becoming resident in a new country may attract tax there if the new country taxes trust distributions.

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Pensions

UK Pension Position

UK registered pension schemes (SIPPs, occupational defined contribution schemes) continue to operate under UK rules for non-UK residents. Key pre-departure pension considerations:

• Lump sum withdrawal: if you plan to take a pension commencement lump sum (tax-free cash), doing so before departure (or in the year of departure) can be advantageous if the destination country would tax pension receipts.
• QROPS transfer: for long-term non-UK residents, transferring a UK pension to a Qualifying Recognised Overseas Pension Scheme (QROPS) may offer advantages — more flexible access, local currency investment, and succession benefits. However, the QROPS transfer tax ("overseas transfer charge" of 25%) applies in many circumstances. Specialist pension advice is essential.
• Annual allowance carry-forward: if you have unused annual allowance from the previous three tax years, making a large pension contribution in the year of departure (and claiming relief) can be tax-efficient.

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Trusts, Foundations, and Offshore Structures

Existing UK Trusts

If you are a settlor of a UK or offshore trust, your departure from the UK may affect the trust's tax status:

• If you created the trust as a UK-domiciled person, the trust may remain subject to UK IHT regardless of your residence.
• Once non-UK resident, the trust's income may not be attributed to you under the settlor-interested trust rules unless the trust distributes.
• If you intend to become non-domiciled (over time), the trust's excluded property status may change.

Establishing New Structures

Before departure may be the right time to establish a new structure (offshore trust, foundation, or holding company) that will be most effective when you are non-UK resident. Structures established as a UK resident may be treated differently from structures established as a non-resident.

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Business Interests

UK Company Shares

If you own shares in a UK private company, before departing consider:

• Pre-sale restructuring: extracting retained cash from the company as a capital dividend (if possible) or via a buyback before departure.
• Entrepreneurs'/BADR crystallisation: selling the business before departure if BADR is available.
• Company continued operation: a UK company continues under UK corporation tax rules regardless of your residence — but your personal tax on dividends received from the company may change significantly.

Non-UK Business Interests

Business interests in other countries should be assessed against the rules in those countries on your change of residence. Some countries assert continued taxing rights on business income even after you leave.

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Key Practical Steps Before Departure

1. Engage a specialist tax adviser in the departure country and the arrival country — at least 12 months, ideally 2–3 years, before departure.
2. Complete the capital gains review: identify appreciated assets, map gains, and decide whether to crystallise before or after departure.
3. Review all income sources and plan their termination, continuation, or restructuring.
4. Review pension arrangements: maximise contributions, consider lump sum timing, assess QROPS suitability.
5. Review existing structures (trusts, companies, foundations): identify changes needed before departure.
6. Ensure wills and powers of attorney are in order: your existing will may be invalid or suboptimal in the new country.
7. Maintain departure records: keep evidence of your departure date, severed UK ties, and establishment of new residence — essential for Statutory Residence Test compliance and HMRC enquiries.
8. Notify relevant authorities: HMRC (P85 form), pension providers, banks, investment managers.

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The Cost of Not Planning

The window for pre-departure planning is finite. Once you become non-UK resident, certain planning opportunities close permanently:

• Assets that could have been crystallised with BADR (an 18% CGT rate for 2026/27) may later be disposed of under full rates.
• Pension contributions that could have been made under UK rules may no longer be possible.
• Trust structures that would have been efficient if established pre-departure may face different treatment if created post-departure.

The cost of inaction in this period can be very significant.

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How Global Investments Can Help

Global Investments provides pre-departure financial planning for internationally mobile HNW individuals. Our advisers work with specialist tax counsel in the departure and arrival jurisdictions to develop a coordinated pre-departure plan covering capital gains, income, pensions, trusts, and business interests.

We have extensive experience working with clients moving to the UAE, Singapore, Monaco, Switzerland, and other destinations favoured by internationally mobile individuals. We can introduce you to specialist tax practitioners in the relevant jurisdictions and manage the overall advisory process.

Pre-departure planning is time-critical. Contact Global Investments at least 12–18 months before your intended departure date to ensure adequate time for proper planning. Seek regulated tax and financial advice specific to your individual circumstances. Rules change; this guide reflects the position as of June 2026.