Rachel Reeves nightmare as 16,500 of UK richest people abandon Britain

Britain is set to lose a record 16,500 millionaires in 2025, as rising taxes push the country's wealthiest residents to leave.This marks the largest annual outflow of high-net-worth individuals (HNWIs) in UK history, according to the latest Henley Private Wealth Migration Report.

The report highlights that the UK will lose twice as many millionaires as China, and 10 times more than Russia. The primary reason for this exodus is the overhaul of the UK's tax regime for the wealthy. Dr Juerg Steffen, the chief executive of Henley and Partners, said: "This unprecedented outflow follows an already record-breaking year in 2024, when 10,800 affluent residents departed in search of greener pastures - compounding the mounting capital drain that began with Brexit."

The report will be a blow for Chancellor Rachel Reeves, who recently abolished the "non-dom" tax status, which had allowed affluent foreign residents to shield their global assets from UK taxes for a fee.

Now, anyone living in the UK for more than four years to pay British taxes on their worldwide income and capital gains. Over time, their assets will also become subject to the UK's 40% inheritance tax.

The closure of a popular UK migrant route, the Tier 1 investor visa in 2022, which had previously offered a way for wealthy foreigners to settle in Britain, has further accelerated the trend.

Dr Steffan said: "Then, in March 2024, the Conservative Government's overhaul of the non-domicile tax regime, followed by Labour's announcement of changes to inheritance tax rules in October, triggered a sharp escalation, pushing net millionaire departures into double digits for the first time."

Those leaving are estimated to collectively control £66billion in investable assets. Before Brexit and these recent policy changes, Dr Steffen said the UK consistently attracted "more millionaires than it lost".

Now, the number of British nationals applying for overseas residence and citizenship programmes through Henley and Partners has surged by 183% in the first quarter of this year alone.

Popular destinations for departing UK millionaires include the United Arab Emirates, the United States, Italy, and Switzerland. The UAE, in particular, is seeing the greatest influx, thanks to zero income tax and a business-friendly environment. The US and Switzerland also remain perennial favourites.

Some experts argue the scale of the exodus is relatively small in the context of the UK's overall millionaire population - just 0.6% are leaving.

Still, the departure of high-profile figures such as billionaire heiress Anne Beaufour, investor Max Gottschalk, and boxing promoter Eddie Hearn underscores the shifting mood among the UK's wealthy elite.

Other major European economies, including France, Spain, and Germany, are also expected to see net outflows of millionaires this year, though on a much smaller scale.

Globally, the movement of wealth is at record levels, with 142,000 millionaires set to relocate in 2025.