Expected tax revenues from the abolition of non-dom status have been dismissed as “fantasy economics” by a former government economist, amid warnings that the Chancellor is relying on deeply flawed assumptions to plug future gaps in the public finances.
Fresh post-Budget analysis published today by economic consultancy ChamberlainWalker suggests that forecasts underpinning the non-dom reforms are increasingly detached from reality. Drawing on the Office for Budget Responsibility’s latest Budget report alongside earlier forecasts, the study concludes that the government is assuming almost £16bn in tax receipts over the next three years will flow from overseas assets being brought into the UK — an outcome the authors say is highly unlikely under current legislation.
At the heart of the government’s projections is the expectation that around £130bn of foreign assets will be repatriated to the UK via the Temporary Repatriation Facility (TRF), part of the reforms introduced following the abolition of non-dom status in 2024. The OBR estimates that this would generate nearly £16bn in tax receipts in the near term and contribute towards a projected £34bn in revenues by 2029-30.
However, ChamberlainWalker’s analysis argues that this optimism rests on three questionable assumptions. First, it says the Treasury is banking on large numbers of non-doms making use of the TRF, despite tax advisers actively discouraging clients from doing so in its current form. While the government expects £360bn in overseas assets to be eligible, the report suggests there is little incentive for individuals to transfer funds without stronger legal certainty.
Second, the analysis challenges the assumption — unchanged in the 2025 Budget — that only one in seven affected non-doms will leave the UK. Recent evidence, the report claims, indicates that departures may already be at least 50 per cent higher than the OBR had anticipated.
Third, it questions the belief that the remaining non-dom population has a similar level of foreign income and gains to those who have already left. ChamberlainWalker says there are strong indications that those exiting the UK include individuals with significantly higher overseas wealth, including several high-profile billionaires, meaning the tax base could erode far faster than expected.
Chris Walker, founding partner of ChamberlainWalker and a former government economist, said the projections risk leaving a sizeable hole in the public finances if they fail to materialise.
“The government’s bet that it will receive almost £34bn of tax receipts by 2029-30 is based on increasingly unreliable assumptions,” he said. “Assuming that non-doms are going to shift £130bn of taxable assets into the UK is fantasy economics under the current legislation. If no tax adviser is willing to recommend the Temporary Repatriation Facility, there is zero chance revenues will come anywhere close to the Chancellor’s Budget figures.”
The report also warns that meaningful data on the true impact of the reforms may not emerge until early 2027, leaving ministers effectively “crossing their fingers” that the revenues arrive later in the parliament. While that may be politically convenient, the authors argue, it is no substitute for robust fiscal planning.
To mitigate the risk, ChamberlainWalker recommends a targeted amendment to the Finance Bill currently passing through Parliament. The proposal would provide explicit reassurance that non-doms using the TRF in good faith will not later be caught by anti-avoidance rules or retrospective tax challenges. According to the report, such a safeguard could help persuade more individuals to remain in the UK and bring foreign assets onshore, improving the credibility of the revenue forecasts.
Without such changes, the analysis concludes, the government risks discovering too late that one of its key post-Budget revenue streams was built on hope rather than hard economics.
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Non-dom tax revenues branded ‘fantasy economics’ by former government economist