The UK Temporary Repatriation Facility: How Indian Former Non-Doms Can Bring Pre-2025 Offshore Money Onshore at 12%

You spent years in London on the remittance basis. Your Indian rental income, the gains on the Indian mutual funds your father set up for you, the dividends from the family company, all of it stayed in your NRO account or an offshore account in Singapore, and you were careful never to bring it into the UK because the moment you did, it became taxable here at your marginal rate. That discipline was the whole point of the remittance basis. Now the remittance basis is gone, abolished from 6 April 2025, and you are sitting on a pile of pre-2025 foreign income and gains that has never been taxed in the UK and that you still cannot spend here without a tax bill. The UK government, having taken away the regime, has handed you a short and unusually generous way out, and most of the people it was designed for either do not know it exists or are quietly assuming they will get to it next year.

The 30-second answer: The Temporary Repatriation Facility (TRF), introduced in Finance Act 2025, lets anyone who used the remittance basis in any earlier year bring pre-6-April-2025 foreign income and gains into the UK at a flat rate of 12% in the 2025/26 and 2026/27 tax years, rising to 15% in 2027/28, after which the facility closes. You designate the amounts in your self-assessment return and pay the charge; once designated, that money can be remitted to the UK at any time afterwards with no further UK tax. Outside the facility, the same income would be taxed on remittance at up to 45% and gains at up to 24%. For an Indian former non-dom with, say, GBP 200,000 of unremitted Indian income, the TRF cost is GBP 24,000 rather than up to GBP 90,000. The window is genuinely short, so the decision is when, not whether, to look at it.

This guide is written for the Indian who lived in the UK as a non-dom, kept Indian income and gains offshore, and now wants to actually use that money, whether to spend it here, buy a UK property, or invest it. It covers what the TRF is and why it exists, exactly what qualifies and what does not, how the flat rate compares to what you would otherwise pay, a full worked example with GBP numbers, how designation works mechanically and why the mixed fund rules suddenly stop being your enemy, how the TRF sits alongside the new four-year FIG regime, and the edge cases that decide whether this is a clean win or something you need advice on. It is not tax advice for your specific facts, and the closing read explains where the line is.

Why the facility exists at all

The remittance basis was, for decades, the deal the UK offered non-domiciled residents. You lived here, you paid UK tax on your UK income and on anything you brought into the UK, and your foreign income and gains stayed outside the UK tax net for as long as they stayed outside the UK. For an Indian professional or business family, that was a clean arrangement: salary and bonus earned in the UK were taxed here, but the Indian rent, the Indian capital gains, the offshore investment income, all of it sat abroad untouched by HMRC, growing year after year into a substantial offshore pot.

From 6 April 2025 that regime is abolished. The Finance Act 2025 replaced domicile-based taxation with a residence-based system. Going forward, a long-term UK resident is taxed on worldwide income and gains as they arise, the same as any other UK resident, with a separate four-year relief for genuinely new arrivals that I cover below. The detail that matters for this guide is what happened to the money that piled up under the old rules. All those pre-2025 foreign income and gains were never taxed in the UK because they were never remitted. Under the old law, if you brought them in, they would be taxed on remittance at full rates, potentially decades after they arose. That is a powerful disincentive to ever bring the money home, and the government knew it.

So the government offered a bridge. It wants that capital onshore, spent on UK property, UK businesses, UK life, rather than parked offshore forever to dodge a remittance charge. The Temporary Repatriation Facility is the bridge. For a limited window, it lets former remittance-basis users pay a low flat rate to convert that frozen offshore money into clean, freely usable UK money. The honest framing is that this is a settlement, not a gift. The government collects tax it might otherwise never have seen, and you get certainty and access at a fraction of the normal cost. Both sides come out ahead, which is exactly why the rate is set low enough to be worth taking.

What the TRF actually does

The mechanics are simpler than the surrounding noise makes them sound. The TRF gives you the right, for the duration of the window, to designate a chosen amount of your pre-6-April-2025 foreign income and gains and pay a flat charge on the designated amount. That is it. You are not waiting for a remittance to trigger tax. You choose an amount, you declare it, you pay the flat rate on it.

The flat rate is 12% for the 2025/26 tax year and the 2026/27 tax year, then 15% for the 2027/28 tax year, and the facility ends after 5 April 2028. The rate applies equally to income and to gains, which is itself a simplification, because normally those are taxed under different rules at different rates.

The genuinely valuable feature is what happens after designation. Once an amount has been designated and the TRF charge paid, that amount becomes clean capital for UK purposes. You can remit it to the UK whenever you like, in 2026 or in 2035, and there is no further UK tax on the remittance. You have pre-paid. This is the part people underweight. The TRF is not just a discount on bringing money in now. It is a way to permanently detoxify an offshore pot so that it stops being a tax problem for the rest of your life as a UK resident.

A few things follow from this design:

• You do not have to remit the money to designate it. Designation and remittance are separate steps. You can designate now, pay the 12%, and leave the money offshore until you need it.
• You choose the amount. You are not forced to designate everything at once. You can designate GBP 50,000 this year and GBP 150,000 next year if that suits your cash flow, as long as each designation is inside the window.
• The charge is on the designated amount itself, not on top of some other tax. Designate GBP 100,000, pay GBP 12,000, done.

What qualifies, and what does not

This is where you have to be precise, because the facility is narrow by design. Three conditions matter.

You must have used the remittance basis. To be eligible for the TRF at all, you must have been taxed on the remittance basis in at least one earlier tax year. If you were always taxed on the arising basis, or you arrived recently and never claimed remittance basis, the TRF is not for you. For the typical reader of this guide, the long-settled Indian non-dom in the UK, this condition is almost always met, because the remittance basis was the entire reason you kept Indian money offshore.

The income or gains must have arisen before 6 April 2025. The TRF is a transitional measure for the old stock of untaxed foreign income and gains, not for anything that arises after the regime changed. Indian rent received in 2023, a capital gain on Indian shares realised in 2024, dividends credited offshore in 2022, all of that is in scope. Income arising from 6 April 2025 onwards is outside the TRF and taxed under the new rules.

The income or gains must not already have been taxed in the UK, and must not be exempt. The point of the facility is to deal with amounts that escaped UK tax under the remittance basis. If something was already taxed here, there is nothing to settle.

What this covers in practice, for an Indian former non-dom:

• Unremitted Indian rental income held in an NRO account or offshore account.
• Unremitted Indian capital gains, including gains on Indian listed shares, mutual funds, and property sold before 6 April 2025.
• Offshore dividends and interest that arose pre-2025 and were kept outside the UK.
• In many cases, income and gains held within offshore structures and certain trust distributions, though trusts add complexity and are firmly in advice territory.

What it does not cover:

• Anything arising on or after 6 April 2025. That is the new world, taxed as it arises, with the four-year FIG regime as the only relief for recent arrivals.
• Clean capital, meaning the original principal you took abroad that was never income or gains in the first place. That was always remittable tax-free, so there is nothing to designate and no reason to pay 12% on it. Designating clean capital by mistake is simply giving HMRC money it was never owed.
• Income that was already remitted and taxed, or that is exempt.

The distinction between clean capital and untaxed income inside the same offshore account is the heart of the mixed fund problem, which the TRF handles unusually kindly, and which I come to below.

How much it saves, in plain numbers

The value of the TRF is best understood by asking what the alternative costs. The alternative is remitting the same money outside the facility, which means it is taxed under the ordinary rules that the TRF temporarily overrides.

Outside the facility, remitted foreign income is taxed as income in the year of remittance at your marginal rate. For an additional-rate taxpayer that is 45%. For a higher-rate taxpayer it is 40%. Even a basic-rate taxpayer pays 20%, already higher than the TRF's 12%. Remitted foreign gains are taxed at the relevant capital gains rate, currently up to 24% on residential property gains and 24% on other chargeable gains for a higher or additional-rate taxpayer.

Set against those, the TRF's flat 12% is a meaningful discount on almost any profile, and a very large one for the additional-rate taxpayer sitting on unremitted income. The gap is widest exactly where these offshore pots tend to be largest, which is high-earning Indian professionals and business families who were additional-rate taxpayers and kept substantial Indian income offshore for years.

There is also the cost that does not show up as a tax rate at all: the cost of the money being stuck. Under the remittance basis, that offshore pot was effectively frozen for UK use. You could not buy a UK house with it, could not invest it here, could not spend it here, without triggering tax at full rates. The TRF does not just lower the rate. It unfreezes the money permanently.

Worked example: GBP 200,000 of unremitted Indian income

Take a concrete case. Priya is an Indian national who has lived and worked in London since 2014. She used the remittance basis throughout. Over those years she accumulated GBP 200,000 of Indian rental income and Indian dividend income, all arising before 6 April 2025, sitting in her NRO account and a Singapore account, never brought into the UK. She is an additional-rate taxpayer. She now wants to use this money to help fund a UK property purchase.

Option 1: designate under the TRF in 2026/27.

• Amount designated: GBP 200,000
• TRF rate for 2026/27: 12%
• TRF charge: GBP 200,000 x 12% = GBP 24,000
• Net amount now freely usable in the UK: GBP 200,000 (she can remit the full GBP 200,000 to the UK at any time with no further tax; the GBP 24,000 charge is paid separately through self-assessment)

After paying GBP 24,000, the entire GBP 200,000 is clean. She can bring it into the UK this year for the property, or leave it offshore and bring it in later. No further UK tax arises on the remittance, ever.

Option 2: remit GBP 200,000 outside the facility, taxed as income.

• Remitted foreign income taxed at her marginal rate: 45%
• Tax: GBP 200,000 x 45% = GBP 90,000
• Net amount available after tax: GBP 110,000

The difference is GBP 66,000 on this single amount. Put differently, remitting outside the facility costs her nearly four times as much tax as designating under the TRF, and leaves her with GBP 90,000 less money to put towards the house.

Option 3: wait and designate in 2027/28 instead.

• TRF rate for 2027/28: 15%
• TRF charge: GBP 200,000 x 15% = GBP 30,000

Waiting one tax year past the 12% window costs her an extra GBP 6,000 on the same GBP 200,000, for no benefit. And after 5 April 2028 the facility is gone entirely, dropping her back to the GBP 90,000 outcome of Option 2. The arithmetic is blunt: the cheapest version of this decision is the one made inside the 12% window, and every year of delay only adds cost.

Now scale it. The same logic on GBP 500,000 of unremitted income is a TRF charge of GBP 60,000 at 12% against GBP 2,25,000 of income tax at 45% outside the facility, a difference of GBP 1,65,000. The bigger the offshore pot, the larger the absolute saving, which is why this matters most to exactly the readers who built up the most offshore.

How designation works in practice

The TRF is not automatic and it is not claimed by writing a letter. It works through the system you already use, self-assessment.

You make a designation election in your self-assessment tax return for the relevant tax year, specifying the amount of pre-6-April-2025 foreign income and gains you are designating. You pay the flat charge on that designated amount through the normal self-assessment process. The deadline to make or amend the election runs to 12 months after the normal filing date for that year. For the 2025/26 year, the filing date is 31 January 2027, so a 2025/26 designation can be made up to 31 January 2028.

A few practical points that decide whether this goes smoothly:

• Records are everything. You need to be able to identify the amounts you are designating: when the income or gain arose, that it arose before 6 April 2025, that it was foreign, and that it was not already taxed or exempt. If your offshore bookkeeping is loose, this is the year to fix it, because a designation you cannot evidence is a designation that invites challenge.
• Designation is a positive act. Nothing happens by default. If you do nothing, the window simply closes and your offshore pot stays frozen under the old, expensive rules. The facility rewards people who act and does nothing for people who wait.
• You can spread it across years. Within the window you can make designations in more than one year, which lets you manage the cash cost of the charge against your other liabilities. Just keep an eye on the rate step-up: amounts designated in 2027/28 cost 15%, not 12%.

The mixed fund rules, and why the TRF relaxes them

If you have ever taken advice on the remittance basis, you will have heard the phrase mixed funds said with a grimace. A mixed fund is an offshore account that contains more than one type of money: clean capital, taxed income, untaxed income, gains, all jumbled together. The ordinary remittance rules apply a strict, unfavourable ordering when you remit from a mixed fund, broadly treating the most-taxed income as coming out first, which is the worst result for you. Untangling a mixed fund built up over a decade is one of the most painful and expensive exercises in non-dom tax.

The TRF includes a deliberate relaxation of these rules, and it is one of the most useful features of the whole facility. Where you designate an amount within a mixed fund, special ordering applies so that, broadly, the designated amount is treated as the first money remitted out of that mixed fund, regardless of the actual composition of the fund or the years the various components arose. In effect, designation lets you pull your chosen, pre-paid 12% money out cleanly ahead of everything else, instead of fighting the normal ordering rules.

That matters because it removes a barrier that would otherwise make the offshore pot almost unusable. Without this relaxation, remitting from a long-standing mixed account would drag the most heavily taxed income out first at full rates. With it, you designate, you pay 12%, and the designated slice comes out first and clean. For the Indian non-dom whose NRO account has years of rent, dividends, and original capital all mixed together, this is the difference between a workable plan and a forensic nightmare.

How the TRF sits alongside the FIG regime

The TRF is one of two transitional features that arrived with the end of the remittance basis. The other is the four-year foreign income and gains (FIG) regime, and it is important not to confuse them, because they do different jobs for different people.

The FIG regime is forward-looking and for new arrivals. A qualifying new UK resident, broadly someone who was non-resident for the previous ten years, can elect for their foreign income and gains arising in their first four years of UK residence to be free of UK tax, even if remitted. It deals with income arising after you become resident, in a defined early window.

The TRF is backward-looking and for established former non-doms. It deals with the old stock of pre-6-April-2025 income and gains that accumulated under the remittance basis, letting you settle them at a flat rate.

The two can interact. A person may, depending on their circumstances and timing, be able to access both, because each is subject to its own separate conditions and is considered individually. But they are not substitutes. If you are a long-settled Indian non-dom with a large frozen offshore pot, the TRF is your tool and the FIG regime probably does nothing for you. If you are a recent arrival, the FIG regime is your tool and you may have little or no pre-2025 stock to designate. Read the UK FIG regime four-year window guide for the new-arrival side of this, and treat the two regimes as separate questions you answer separately.

Edge cases

The general rule is clean. The edges are where you need to slow down.

Who actually qualifies. You must have been taxed on the remittance basis in some prior year. If you were a non-dom who was always taxed on the arising basis, perhaps because your foreign income was small and claiming the remittance basis was not worth it, you may not have used the remittance basis in the technical sense the TRF requires. Confirm your past returns before assuming eligibility.

Mixed funds you cannot fully analyse. The TRF's relaxed ordering helps enormously, but you still have to identify the amount you are designating and that it is pre-2025 foreign income or gains. If your offshore account is genuinely opaque, with no records of what arrived when, designation becomes a question of reconstructing history. This is solvable but it is work, and it is the single biggest reason to start now rather than in January 2028 when the deadline pressure is real.

Interaction with the FIG regime and with double tax relief. Where Indian tax has already been paid on the same income or gain, the interaction with UK relief needs care. The TRF charge is a UK charge on designation; it is not the same as taxing the remittance, so the usual foreign tax credit mechanics do not map onto it neatly. If you paid Indian tax on the rent or the gain, take advice on how that sits against a TRF designation rather than assuming a credit. The broader India UK position is set out in the India UK DTAA deep dive and foreign tax credit and Form 67, but the TRF specifically is a transitional UK measure that those frameworks were not written for.

Offshore trusts and structures. Income and gains held within offshore trusts and similar structures can in many cases be brought within the TRF, but the rules around trust distributions and matching are intricate and well beyond what a single designation election handles cleanly. If your offshore money sits inside a structure rather than a plain account, this is not a do-it-yourself exercise.

Record-keeping for the future. Even after a clean designation, keep the paperwork. You are establishing that a specific amount is now clean capital that can be remitted free of UK tax indefinitely. The evidence that you designated it and paid the charge is what protects that status years later when you actually bring the money in. Treat the designation records as permanent, not as something to file and forget.

Non-residence in the relevant year. The facility is for UK residents making designations in their self-assessment returns. If your residence position is itself in flux, for example because you are planning to leave the UK, the timing of designation against your residence status needs thought. See UK temporary non-residence and CGT for how leaving and returning interacts with UK gains.

The closing read

The honest read is that the Temporary Repatriation Facility is one of the few genuinely taxpayer-favourable measures to come out of the non-dom reforms, and it is aimed squarely at people like you: the Indian who lived in the UK as a non-dom, kept Indian income and gains offshore by design, and now has a frozen pot that the old rules made expensive to ever use. For two tax years you can convert that pot into clean, freely spendable UK money at 12%, against a normal cost of up to 45% on income and up to 24% on gains. That is not a marginal saving. On a GBP 200,000 pot it is GBP 66,000, and the absolute number only grows with the size of the pot.

The catch is entirely about timing, and timing is the part people get wrong. The 12% rate exists only for 2025/26 and 2026/27. It becomes 15% in 2027/28, and then the facility is gone. There is no version of this where waiting helps you. If you have a meaningful offshore pot of pre-2025 income and gains and any intention of using that money in the UK, the question is not whether to designate but how much and in which year, and the cheapest answer is almost always sooner rather than later.

Where this stops being a do-it-yourself decision: if your offshore money is in a genuine mixed fund you cannot fully reconstruct, if it sits inside a trust or structure, or if Indian tax has already been paid and the interaction with UK relief is unclear. Those are advice cases, and the cost of getting advice is trivial against the sums in play. For the simpler case, a plain offshore account of identifiable pre-2025 Indian income, the path is clear: identify the amount, designate it in your self-assessment return inside the 12% window, pay the charge, keep the records, and stop paying the remittance basis tax that the rest of the world is about to start paying in full.

Related guides

• The UK FIG regime four-year window for new arrivals
• UK temporary non-residence and CGT
• UK NRI Indian funds and the offshore income gains rules
• ISAs and pensions for non-resident NRIs in the UK
• The India UK DTAA deep dive
• Foreign tax credit and Form 67
• DTAA relief for NRIs
• NRI residency and RNOR rules
• Tax-efficient investing for NRIs
• NRI portfolio asset allocation
• NRE, NRO and FCNR accounts explained
• Sending money to India

Disclaimer

This guide is general information, not tax or financial advice, and it does not create an adviser relationship. The Temporary Repatriation Facility was introduced by Finance Act 2025 and its detailed rules, rates, and deadlines may be amended; the 12% rate applies for the 2025/26 and 2026/27 tax years and 15% for 2027/28, after which the facility ends. Whether you qualify, what amounts are eligible, how the mixed fund and ordering rules apply to your offshore accounts, how the TRF interacts with the FIG regime and with any Indian tax already paid, and how designation affects your wider position all depend on your specific facts. Eligibility and amounts must be confirmed against your own records and returns. Before making any designation or remittance, take advice from a UK tax adviser, and where Indian income or gains are involved, from an Indian chartered accountant familiar with the India UK position.