Those with a keen eye may have spotted an important change to the rules on post-departure trade profits for non-UK residents. As many will know, individuals who leave the UK can be caught by the ‘temporary non-UK residence’ (TNR) rules. These anti-avoidance provisions broadly impose UK tax on certain income and gains when an individual returns to the UK after a period of non-residence lasting five years or less. Their purpose is to prevent people from becoming short terms non-residents for tax-motivated reasons in order to sidestep UK income tax or capital gains tax.
Under the current TNR rules, dividend distributions from most non-listed UK and overseas companies paid during a period of temporary non-UK residence are not taxed if they are paid from profits accruing to the company after the individual’s departure from the UK. The portion of a dividend that relates to these post-departure profits is determined on a ‘just and reasonable’ basis.
However, from 6 April 2026, the concept of post-departure trade profits will be abolished. As a result, any dividends from most private companies received during a period of temporary non-UK residence will be fully taxable in the year of return, at the applicable UK tax rate in force.
This represents a significant change for non-UK resident individuals who may wish to extract profits from their UK company while abroad. Those who have been non-resident for five years or less may therefore want to consider accelerating the payment of dividends sourced from post-departure trading profits before the new rules take effect, to avoid a potential tax charge if they return to the UK before five full years of non-residence.
At Sanctuary, we help individuals and business owners navigate these changes with clarity and confidence. From assessing your residence position to structuring dividend planning and exit strategies, our advisors provide tailored, forward-looking advice to help manage UK tax exposure and protect your long-term interests before, during and after a period of non-UK residence. Contact us today via the contact form or email us at hello@sanctuary.ae.
For UK businesses considering opportunities in Saudi Arabia, the following steps outline the overall process:
1. Business Activity: Determine the appropriate business activity which will aligns with your business and satisfies all undertakings you will engage with in the Kingdom.
2. Local Partnerships: Consider any potential opportunities for collaborations with established local businesses to ease market entry and meet regulatory requirements.
3. Documentation: Gather the required documentation for incorporation in KSA.
4. Company Registration: Work with experts and the relevant governing bodies to assist with the incorporation process, ensuring compliance with local laws and regulations.
5. Other Requirements: Consider any other requirements for establishing in Saudi Arabia such as capital and tax requirements.
Saudi Arabia's Vision 2030 represents a significant opportunity for UK businesses to engage with an expanding market with vast potential. As the Kingdom continues to diversify its economy and expand its global influence, UK companies are well-positioned to support and benefit from this transformation. With the right strategy, partnerships, and local support, there are a wealth of possibilities.
By aligning your business with Saudi Arabia’s Vision 2030, the benefits for UK and international businesses looking to Saudi Arabia have never been greater.
At Sanctuary, we specialise in assisting businesses looking to expand into Saudi Arabia. We help navigate the complexities of the Saudi market, ensuring that you have the expertise needed to best prepare for success, so get in touch today.
Our expert team offers comprehensive support across a range of services, from company registration, advisory services, and more. Explore our services to discover how we can help you.
Vision 2030 is a strategic framework designed to diversify Saudi Arabia’s economy, reduce its dependency on oil, and transform the Kingdom into a global business hub.
Key points include economic diversification, social reforms, investment in technology and infrastructure, sustainability, and creating a competitive workforce.
The main focus of the Saudi Arabian Vision 2030 strategy is to build on key economic sectors such as hospitality, travel and tourism and build economic stability and sustainability.
Saudi Arabia’s Vision 2030 initiative is aimed at diversifying its economy through strategic investments into the non-oil sector and ensuring a more sustainable economic future.
Saudi Arabia has committed over $500 billion to Vision 2030, funding projects that span a variety of sectors, including energy, tourism, and infrastructure.
Yes, with its growing economy, reform initiatives, and investment incentives, Saudi Arabia is a highly attractive destination for foreign businesses seeking growth opportunities.
Key growing industries include renewable energy, tourism, healthcare, technology, and education.
Saudi Arabia permits foreign owned businesses and investment into the Kingdom, which has been elevated by the Vision 2030 initiative. A MISA licence is required for foreign investors or businesses to establish.
As a result of the diversification efforts of Saudi Vision 2030, the non-oil and private sector in the Kingdom have witnessed unprecedented growth in the past few years. The private sector continues to grow each quarter and the non-oil sectors continue to reach record contributions for the Kingdom’s GDP.
