Updated
GL-D-02
Glossary · Statuses, passports, travel
Domicile - the country the law treats as your permanent home
The country a person considers their permanent home for life — a concept broader than tax residence. It affects inheritance taxes in a number of countries, for example in the US for foreign nationals.
01 / In 30 seconds
The short answer
- What it is
- The country a person regards as their permanent home for life
- How it differs
- A broader and more stable concept than tax residence
- What it affects
- Inheritance and gift taxes in some countries (the US and others)
- Is it easy to change
- No: domicile is more stable than residence and harder to change
- Can be planned
- Yes: but it requires genuinely moving your centre of life
02 / In plain words
What Domicile means
Domicile is the country a person regards as their permanent home, the place where they ultimately belong. It is a legally broader and more stable concept than tax residence: residence can change as often as every year based on days, while domicile rests on a deeper connection with a country — usually the country of birth or one consciously chosen for life.
There is domicile of origin (inherited, usually from the father) and domicile of choice (when a person consciously moves their centre of life to another country for good). The key role of domicile is in inheritance and gift taxes: in the US, for example, a foreigner's domicile determines whether worldwide assets are subject to estate tax. Since 6 April 2025 the United Kingdom has looked at long-term residence instead of domicile: 10 tax years out of the previous 20.
Changing domicile is harder than changing residence: leaving is not enough — you need to genuinely and permanently move your centre of life, sever ties with the old country and put down roots in the new one. That is why domicile is planned for the long term, together with tax residence and the structure of your assets.
A case from practice
A foreign national has lived in the US for many years but regards their country of birth as home and plans to return. For US estate tax this decides whether all their worldwide assets are taxed or only their US assets. Words are not enough: domicile is shown by a home, family, business and documents.
Where domicile matters
- Inheritance and gift taxes
- Long-term tax planning
- Moving to and from the United Kingdom
- Structuring worldwide assets
- Planning the transfer of assets to children
- Changing your country of life for good
03 / What it covers
What matters about domicile
Types
- Of origin (inherited)
- Of choice
- Usually from the father
Indicators
- Permanent home
- A deep connection
- The intention to stay for good
What it affects
- Inheritance tax
- Gifts
- Worldwide assets (UK)
Change
- Genuinely moving your centre of life
- Severing old ties
- A long process
04 / How it works
How domicile is planned
Assessing your current domicile
Where your domicile of origin is and whether you have a domicile of choice.
Calculating the tax consequences
Where domicile or residence affects inheritance tax.
Moving your centre of life
Home, family, business and the intention to stay in the new country.
Severing old ties
Which ties with the old country to close and which to keep.
A new domicile of choice
The new domicile is backed by facts and documents.
05 / Key facts
What you need to know
01What it is
A permanent home for life
A broader and more stable concept than tax residence. Residence changes with days spent; domicile changes only with your centre of life.
02Types
Of origin and of choice
Domicile of origin comes from your parents. Domicile of choice arises when you move your life to another country for good.
03What it affects
Inheritance and gift taxes
In the US, for example, a foreigner's domicile decides whether worldwide assets or only US assets are taxed.
04United Kingdom
A residence test since 6 April 2025
For inheritance tax, long-term residence replaced domicile: 10 tax years out of the previous 20.
Common mistakes
Confusing domicile with tax residence
Check both separately: they follow different rules and have different consequences.
Thinking a move changes domicile by itself
Move your centre of life: home, family, business and the intention to stay.
Planning UK inheritance tax around domicile
Count your years of UK residence under the rules in force since 6 April 2025.
Keeping ties with the old country
Decide which ties to keep and document your new centre of life.
06 / Expert advice
How to prepare in advance
Domicile is planned for the long term, together with tax residence and the asset structure. Assess your current domicile and its tax consequences (especially for inheritance) in advance, and if you intend to change it, genuinely move your centre of life, sever ties with the old country and put down roots in the new one. Then the change of domicile withstands scrutiny.
What we do for you. We review your domicile together with your tax residence: where you “belong” in law, how that affects inheritance taxes and the asset structure, and what it really takes to change domicile if that is your goal.
Dmitry NagyTax consultant, international taxation and compliance (ex-Big4)
07 / Questions
Frequently asked questions
Residence is where you pay tax on income; it is determined by days and ties and changes relatively easily. Domicile is your permanent home for life, more stable, and affects above all inheritance taxes.
Yes, through a domicile of choice: genuinely and permanently moving your centre of life to another country, severing ties with the old one and putting down roots in the new one. It is harder and slower than changing residence.
First and foremost inheritance and gift taxes. In the US, for example, a foreigner's domicile determines whether worldwide assets are taxed. Since 6 April 2025 the United Kingdom has applied a long-term residence test instead of domicile.
No. Domicile is about an actual deep connection with a country, not citizenship. A passport does not change domicile by itself.
Domicile of origin is inherited, usually from the father. Later it can be changed to a domicile of choice by genuinely moving your centre of life.
In advance and for the long term — together with tax residence and the asset structure, especially if the goal is to optimise inheritance taxes.
INITIAL ASSESSMENT
Tell us what outcome your family needs
We will design a solution for your case, choose the country and the right status, and take the whole process through to the result.
