Thousands of company directors leave UK after Labour’s tax changes

The United Kingdom is witnessing a significant exodus of company directors following the Labour government’s recent tax reforms. Between October 2024 and July 2025, nearly 3,800 directors have reported leaving the UK, a 40% increase from the previous year. The surge in departures coincides with the government’s abolition of the non-domiciled (‘non-dom’) tax status and the extension of inheritance tax to worldwide assets.

The United Arab Emirates (UAE) has emerged as the most favored destination for these individuals, with Dubai leading the relocation trend. Other popular destinations include Spain, the United States, and Monaco. The month of April 2025 saw a particularly sharp rise in departures, with 691 directors leaving the UK, marking a 79% increase over April 2024.

High-profile business figures, including promoters, investors, and finance directors, have been among those relocating. Notably, Lakshmi Mittal, the Indian steel magnate and one of the UK’s wealthiest residents, is reportedly considering leaving Britain in response to the abolition of the non-domicile tax regime. Mittal, who moved to the UK in 1995, views the termination of non-dom tax benefits as a significant motivator for his potential departure. This move aligns him with other wealthy non-domiciled individuals relocating to countries with more favorable tax policies such as the UAE, Italy, and Switzerland.

The government’s decision to end the non-dom status, a tax provision that allowed individuals to avoid UK taxes on foreign income, has been a central factor in this trend. Additionally, the extension of inheritance tax to global assets has further incentivized wealthy individuals to seek more tax-friendly environments abroad. These policy changes have raised concerns about a potential brain drain of wealth creators and the broader economic implications for the UK.

In response to the growing exodus, Chancellor Rachel Reeves is reportedly considering revisions to the non-dom tax rules. The government is under pressure to balance fiscal objectives with maintaining the UK’s attractiveness to international investors and business leaders. Industry leaders and wealth managers have called for tax stability and clarity to prevent further departures and to support long-term financial planning.

The situation underscores the delicate balance between implementing tax reforms to address fiscal needs and ensuring the UK’s competitiveness in the global market. As the government evaluates its policies, the impact on the business community and the broader economy remains a critical consideration.