CashNews.co
A record number of millionaires are expected to leave the United Kingdom as the prospect of tax raises under chancellor Rachel Reeves dampens the appeal of what was once considered a prime destination for the rich.
Up to 9,500 individuals with liquid, investable assets of at least $1m could depart the UK in 2024, more than doubling the exodus seen in 2023, according to migration advisers Henley & Partners. This represents a new record outflow for the UK, with London especially hard hit.
The top destinations for millionaires leaving the UK include the likes of Paris, Dubai, Amsterdam, Monaco, Geneva, Sydney, and Singapore, as well as retirement hotspots such as Florida, the Algarve in Portugal, Malta, and the Italian Riviera.
The UK’s high tax rates and concerns about additional tax hikes that could be announced at the end of the month in the Labour party’s first budget in 14 years, are highlighted as being among the main reasons for the wealth exodus.
“It’s clear that next year’s increase in tax for non-domiciled individuals, announced by the previous Conservative government in March, prompted people to start considering leaving, and this had a domino effect on UK nationals when they realised that capital gains and inheritance tax were the last ones remaining that could possibly be changed and make a difference to the budget shortfall,” Stuart Wakeling, head of Henley & Partners’ UK office, said.
The UK’s wealth exodus is expected to include 85 centi-millionaires — with a liquid investable wealth of at least $100m — and 10 billionaires, which could hit the UK economy.
“Over 60% of centi-millionaires are entrepreneurs and company founders, which makes them key when it comes to wealth creation. The businesses they start up have a significant positive spillover effect on the middle class as they create large numbers of well-paying jobs in their base country,” Andrew Amoils, New World Wealth’s head of research, said.
Read more: UK to lose half a million millionaires by 2028
“It is also worth noting that most of the companies on the FTSE 100 (^FTSE) were started by individuals who went on to become centi-millionaires.”
He expects over 10% of the UK’s centi-millionaires to exit the country this year.
Among the 15 countries with the highest concentrations of millionaires, the UK is projected to suffer the most, with only China expected to see a greater loss of high-net-worth individuals in 2024. The report said that the UK is one of only three nations, alongside Japan and Hong Kong, to have experienced a net decline in wealthy residents since 2013. In contrast, the number of affluent individuals has risen in the US, Canada, Australia, Germany, and France during the same timeframe.