The Top 5 Challenges for High Net Worth Individuals Planning to Leave the UK
In an increasingly complex financial world, High Net Worth (HNW) and Ultra High Net Worth (UHNW) individuals face significant challenges when it comes to managing and protecting their wealth.
For those contemplating leaving the UK, careful planning is required to address key issues relating to tax mitigation and wealth protection.
At Forth Capital, we specialise in guiding HNW and UHNW individuals through these complex transitions, ensuring that their assets are safeguarded, and opportunities are identified and realised. The UK is currently experiencing an unprecedented outflow of HNW and UHNW individuals, with a staggering 157% increase in the emigration of millionaires year-on-year, so in this article, we explore the five most pressing challenges for HNW and UHNW individuals considering leaving the UK.
1. Managing Your Assets and Currency Risk
For individuals moving abroad, currency risk is a key consideration. Fluctuations in exchange rates can significantly affect the value of your UK-based assets.
Effective strategies for moving assets offshore, managing the currencies in which investments are held, and maintaining a globally diversified portfolio adaptable to prevailing changes in economic conditions, are therefore critical to the growth and preservation of your wealth when re-locating from the UK.
Interesting Currency Risk Fact - In 2007 you could buy 2.48 Swiss Francs with £1 GBP. Today the currencies now have relative parity; with the Pound having lost 55% of its value relative to the Swiss Franc and £1 GBP buying just 1.11 CHF¹.
2. Financial Planning for Cross-Border Tax Mitigation and Compliance
Mitigating tax liabilities across different jurisdictions is one of the most significant challenges facing HNWIs and UHNWIs leaving the UK. Understanding and adhering to both UK tax regulations and foreign tax laws is critical. The UK's tax regime, including Capital Gains Tax (CGT), Inheritance Tax (IHT), and income tax, can create substantial liabilities if not efficiently managed.
Compounding this is the challenge of staying compliant with global regulations such as the Common Reporting Standard (CRS) and the US Foreign Account Tax Compliance Act (FATCA) for example, which require detailed reporting of overseas assets.
Without proper financial planning, HNW and UHNW individuals can face not only significant tax bills, but also penalties for non-compliance. Consulting with an experienced international financial planner can help mitigate these risks through strategic planning and the use of legal tax efficiencies.
Interesting CGT Fact - Returning to the UK and re-establishing residence within five years of departure can trigger retrospective taxation (under HMRC’s ‘temporary residence rules’) on previously untaxed income and gains. For example, if you were to sell your business and exit the UK to negate the CGT payable on the sale, but moved back to the UK within 5 years, you could face the capital gains tax liability (of up to 24%) retrospectively.2
3. Estate and Succession Planning Across Borders
One of the most complex aspects of moving abroad is the impact on estate and succession planning. Different countries have varied inheritance laws, including forced heirship rules that could dictate how your assets are distributed upon death. The UK has specific rules regarding inheritance tax (IHT) which is levied at a rate of 40% on the value of your worldwide estate [i.e. your UK and international assets] exceeding the IHT thresholds³ whilst you retain UK 'long-term UK resident' status.
A significant IHT reform, which was announced in the Autumn Budget [on 30 October 2024] and came into effect on 6 April 2025, now means that if you leave the UK and maintain your non UK resident status for 10 consecutive years, you will no longer be regarded by HMRC as having 'long-term UK resident' status, and your overseas [i.e. non UK situs] assets will no longer be subject to IHT. For high net worth and ultra high net worth individuals, this new 'residence-based' IHT regime offers a compelling financial incentive to re-locate, setting the ‘10 year clock’ in motion as soon as possible, and by restructuring your estate to reduce your UK situs assets, effectively minimising or even negating your IHT exposure, to avoid significantly diminishing your family’s inheritance.
Robust cross-border estate planning is required to ensure that you comply with both UK law and the legal requirements of the new jurisdiction you re-locate to, and to ensure the smooth transfer of assets to future generations while minimizing tax liabilities and legal disputes.
Interesting UK IHT Fact - Even under the new residence-based IHT regime and with 10 or more consecutive years of UK non-residence accrued, your UK estate would remain in scope for IHT at a taxable rate of 40%, highlighting the importance of consulting with a dual-qualified international financial planner to strategically restructure your assets and estate.
4. Preserving Pension and Retirement Assets
For those leaving the UK, optimising their retirement assets can be a significant consideration in their financial planning. UK pension schemes, including defined benefit and defined contribution plans, can have significant tax implications when transferred abroad. If not handled correctly, pension transfers can trigger large tax liabilities or reduce the value of your retirement assets.
Solutions such as International Self Invested Personal Pensions and Qualifying Recognised Overseas Pension Schemes (QROPS) offer tax-efficient ways to transfer pensions overseas. At Forth Capital, we help HNW and UHNW individuals explore these options to ensure that their retirement assets are preserved and managed optimally in line with their international move.
Interesting UK Pension Fact - You may have a very generous UK Defined Benefit Pension Scheme, but in the event of your death, typically only 50% of the benefits will pass to your spouse, which could also be taxed at a rate of up to 45%.
5. Inadequate International Expertise from Your UK Financial Advisor, Private Banker, or Wealth Manager
A significant risk for high-net-worth individuals planning to leave the UK is not appreciating the critical importance of their financial planner, private banker and wealth manager having the requisite licences, appropriate qualifications, and practical experience to provide them with a holistic forward-looking cross-border planning strategy and ongoing advice after their re-location.
Most UK-based advisers are not authorised to provide regulated advice outside the UK and are unlikely to fully understand the tax and financial planning complexities that arise once you become a non-UK resident. This can result in sub-optimal outcomes that fall foul of international tax treatment, foreign investment regulations, or overseas pension considerations – potentially leading to avoidable tax liabilities, inefficient asset structuring and compliance breaches.
Relocation changes your financial landscape. Your tax residency shifts, the regulatory environment becomes more complex, and many familiar financial products become unsuitable or even non-compliant. For example, UK ISAs lose their tax benefits once you leave the UK, and certain pension transfers require specialist guidance to avoid punitive charges.
If your advisor does not have the right international perspective, they may overlook critical issues such as:
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Tax-efficient investment structures for your new country of residence.
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Pension transfer and consolidation options across different international jurisdictions.
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Estate planning that accounts for differing international inheritance laws and tax regimes.
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Ongoing advice and support that remains compliant wherever you choose to live.
Choosing a dual qualified adviser who understands both the UK and international tax, investment and financial planning frameworks, ensures that your wealth strategy remains aligned, compliant, and optimised – wherever life takes you. Importantly, it also provides you with peace of mind, knowing that your advisor can continue to support you; not only in preparation for your move, but throughout it, and on an ongoing basis thereafter.
Interesting Fact - Fewer than 1% of UK-based financial advisors hold the international qualifications, regulatory permissions, and dual-jurisdiction licences required to provide compliant, ongoing advice to clients after they leave the UK.
Making the Complex Simple
Relocating abroad is a significant financial decision that requires expert advice and careful planning. At Forth Capital, we specialise in helping HNW and UHNW individuals navigate these complex challenges, offering tailored financial planning solutions that safeguard wealth across borders. From tax-efficient investment strategies to comprehensive succession planning, our goal is to ensure financial security for you and future generations.
Let us help you secure your financial future, and make the complex simple for you, no matter where in the world you choose to live.
Contact us today or send us an email to schedule an initial consultation.
¹ Source: OFX.com - Correct as at 20 May 2025.
2 HMRC Temporary non-residence and Capital Gains Tax - HS278
³ HM Treasury - New residence-based regime for inheritance tax
This communication is for information purposes only and does not constitute financial, legal, or tax advice. Please schedule a meeting to receive advice on international financial planning and wealth management.
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