UK-based wealth managers are seeing a change in their non-dom clients’ attitude towards living in the country, driven by a lack of trust towards the government’s approach to them. And although the current uncertainty over the status of non-doms and the capital gains tax for offshore trusts may result in increasing workloads for international wealth structurers, overall the knock-on effect in the City will be very deleterious, according to multi-family office Stonehage, which administers and manages around $24 billion on behalf of high net worth and ultra high net worth clients. Wealth management analysts predict that London may lose out to Singapore and especially Switzerland now that it has ratified the Hague Convention on trusts. “Clients are worried, the thing they want most of all is certainty and currently the UK is not offering this to them,” Ronnie Armist, executive director at Stonehage told WealthBriefing. The UK government is scheduled to release meaningful detail of its tax plans for the country’s non-dom population on 13 December, plans that will come into effect in the next tax year. “We’re hoping for the best, but helping clients to plan for the worst with these proposals,” said Robby Hilkowitz, Stonehage executive director. “At the moment there’s a whole range of issues mitigating against living in the UK that are coming to the fore for some of our clients. It’s not just the uncertain tax situation; you can add problems, such as air travel for clients who are highly internationally mobile. “Some clients are at the stage of life where uncertainty over their tax status could tip them towards deciding that a move away from the UK is their best option.” Mr Hilkowitz points to the cluster effect, and says that if significant numbers of wealth managers choose to either leave London or to grow their businesses in other locations,the UK capital could suffer, particularly the financial services sector. Non-doms will also be concerned about signing up to a UK tax disclosure regime in the light of recent security breaches at HM Revenue & Customs. “We don’t know yet whether the new regime will require payment of a flat rate of £30,000 as a deferment only, and whether or not this will require disclosure. If disclosure is required, there will be no going back for clients who prefer to conduct their affairs out of the public gaze,” said Mr Armist. Stonehage is producing a white paper on the likely affects of changes to the UK’s non-dom tax regime to coincide with the announcement of the detail next month. The company has been a major beneficiary of the shift towards wealth management. Staff levels have more than doubled to 300 in the last two years, a figure that is likely to increase by a further 50 per cent in the next two years.