Lawyers cast doubt over claims Sunak’s wife’s ‘non-dom’ status has nothing to do with tax benefits
Tax lawyers have cast doubts over claims that Rishi Sunak’s wife is not using her “non-dom” status for tax benefits.
Lawyers countered claims that billionaire heiress Akshata Murthy’s non-domicile status is linked to her Indian nationality, after pointing out domicile has “nothing to do with citizenship” under UK law.
The tax experts noted that Murthy’s non-domicile status likely gives her considerable tax benefits, due to the fact non-doms are not required to pay tax on income from outside the UK.
The counterpoints come after a spokesperson for the Chancellor’s multimillionaire wife claimed Murthy only has non-domicile status due to rules blocking Indian citizens from holding dual nationality under Indian law.
Speaking to Morning Wire London tax lawyer Mark Davies, partner at tax advisory firm Mark Davies & Associates, explained that non-doms must actively claim non-domicile status as he noted that “domicile has nothing to do with citizenship”.
He explained that in order to claim non-dom status, one must actively demonstrate they have a domicile in a different country and that they intend to return to their country of domicile in the future.
The tax lawyer said Murthy’s non-dom status likely means she pays less tax on income from her 0.91 per cent share in Indian tech company Infosys than she would if she was domiciled in the UK.
The heiress’ non-dom status could also help her avoid paying any UK inheritance taxes on any money passed down from her tech billionaire father, Davies said, as he explained Murthy could be eligible to hold money in a tax-free trust.
Tax lawyer Lara Mardell, partner at BDB Pitmans, noted that the cost of holding non-dom status increases to £30,000 a year after seven years.
Murthy has lived in the UK for nine years, according to media reports, meaning she has chosen to pay the £30,000 annual sum instead of becoming a UK domicile.