Tax considerations for private equity executives relocating to the UK

The UK remains an attractive location for private equity executives, investment managers and senior fund professionals. However, anyone relocating to the UK with carried interest, co-investment, restricted stock, deferred bonuses or offshore investments should review their UK tax position before arrival, as the timing of the move can affect how income, gains and investment returns are taxed. 

The UK tax rules for internationally mobile individuals have changed significantly. From 6 April 2025, the remittance basis was replaced with the new Foreign Income and Gains regime, known as the FIG regime. Overseas Workday Relief has also been reformed, and the taxation of carried interest is changing further from April 2026. For private equity executives, these changes mean that pre-arrival tax planning is more important than ever.  

This guide explains the key tax planning points private equity executives should review before relocating to the UK, including UK tax residence, the FIG regime, Overseas Workday Relief, carried interest, co-investment, equity awards and deferred remuneration. We also include a helpful checklist for private equity executives to refer to, ahead of relocating to the UK. 

When does UK tax residence begin? 

The first question is when the individual becomes UK tax resident. This is determined under the Statutory Residence Test and depends on factors such as days spent in the UK, UK workdays, accommodation, family ties and previous UK residence. 

Where an individual moves to the UK part-way through a tax year, split year treatment may apply. This can divide the tax year into a non-UK part and a UK part, but it is not automatic. The precise residence start date can affect the UK taxation of salary, bonuses, carried interest, co-investment returns, Restricted Stock Units (RSUs) and foreign income or gains. 

For that reason, the expected move date should be reviewed before arrival, rather than after the first UK tax return is prepared. 

The FIG regime 

The FIG regime can be valuable for qualifying new UK residents. Broadly, individuals who have not been UK tax resident in any of the previous ten tax years may be able to claim relief on foreign income and gains arising during their first four tax years of UK residence. 

This can be particularly useful for executives who continue to hold overseas investments, offshore accounts or non-UK fund interests after moving to the UK. 

However, the regime is not a general exemption from all UK taxes. It is claim-based and has conditions. A claim can also result in the loss of the UK personal allowance and Capital Gains Tax (CGT) annual exempt amount for the relevant year. The benefit of claiming should therefore be considered carefully. 

Overseas Workday Relief 

Overseas Workday Relief may be available where a qualifying new UK resident performs some employment duties outside the UK. This can be relevant for executives who travel for investment meetings, board meetings, fundraising, portfolio company visits or overseas management responsibilities. 

As of 6 April 2025, the relief is no longer dependent on keeping the relevant employment income offshore. This is a welcome simplification. However, the relief is now capped at the lower of £300,000 or 30% of the relevant qualifying employment income. 

In practice, internationally mobile employees still need to keep good records of UK and non-UK workdays, the purpose of overseas travel and the period over which bonuses or equity awards are earned. Employers may also need to consider payroll reporting and whether a PAYE direction or notification is required. 

Carried interest, co-investment and UK tax planning 

Carried interest is one of the most important areas for private equity executives relocating to the UK. 

In April 2026, carried interest moved into the Income Tax framework. Broadly, qualifying carried interest is subject to a 72.5% multiplier, meaning only 72.5% of the qualifying amount is brought into charge. Whether carried interest qualifies depends on the detailed conditions, including the relevant average holding period rules. 

Executives should review carried interest arrangements before becoming UK resident, particularly where carry was awarded before the UK move, but may vest or be received afterwards. The analysis can also be more complex where the individual continues to provide investment management services from the UK, or where the carried interest is held through offshore partnerships or other fund structures. 

Co-investment arrangements should also be reviewed separately. A genuine co-investment return may be taxed differently from carried interest or management fee income, but the treatment will depend on the terms of the investment, the level of personal risk and the connection with the individual’s employment or investment management role. 

Equity awards, RSUs and deferred remuneration on UK relocation 

RSUs, restricted shares, options and deferred bonus arrangements can also create UK tax issues on relocation. 

An award may have been granted before the individual arrived in the UK, but it may vest, be exercised or be sold after they become UK resident. The UK tax position may depend on the grant date, vesting date, workdays during the relevant earning period and whether the award is employment-related. 

Individuals should not assume that an award is outside the UK tax net simply because it was granted before they moved to the UK. 

Relocation tax checklist for private equity executives 

1. Pin down your residence start date before you move, not after. The Statutory Residence Test and split year treatment are fact-specific, and getting the date wrong can distort how your salary, carry, co-investment and RSUs are taxed. 
2. Find out if the FIG regime actually benefits you. It sounds like a blanket exemption, but it isn’t. Claiming it trades away your personal allowance and CGT annual exempt amount, so the numbers need checking to see if it is beneficial. 
3. Have your workday exposure assessed early. Overseas Workday Relief is capped and conditional, and the record-keeping catches people out. It is important to keep contemporaneous records, as trying to reconstruct later is much more difficult. 
4. Get carried interest reviewed before you arrive. Whether it qualifies for the 72.5% multiplier turns on holding periods, timing and structure, where carry was awarded pre-move but vests later, will require professional UK tax advice. 
5. Have co-investment terms assessed separately from carry. The tax treatment depends on risk and deal terms specific to you. 
6. Get every outstanding equity award checked individually. Grant dates, vesting dates and earning periods all affect the outcome. Assuming pre-move awards are safe is a common, costly mistake. 

Every point above depends on the specific facts and timing, which is exactly why this isn’t something to work through alone. 

FAQs 

When do I become UK tax resident? 

It depends on the Statutory Residence Test. The days in the UK, workdays, accommodation and family ties all play a part, and split year treatment may apply if you move mid-year. There’s no single trigger date; it has to be worked out from your specific pattern of ties and time in the UK. 

Can I use the FIG regime when I move to the UK? 

Only if you haven’t been UK tax resident in any of the previous ten tax years. Even then, it’s a claim you have to make each year, not an automatic exemption, and claiming it means giving up your personal allowance and CGT annual exempt amount. So, whether it’s worth claiming depends on your income and gains. 

How does Overseas Workday Relief work after 6 April 2025? 

The relief no longer requires you to keep the income offshore, but it’s now capped at the lower of £300,000 or 30% of qualifying income. Whether you qualify, and how much relief you get, depends on your workday split and how your employment is structured. 

What happens to carried interest received after I become UK resident? 

From April 2026, qualifying carried interest is taxed under Income Tax with a 72.5% multiplier. However, “qualifying” depends on detailed conditions, including holding periods, and timing matters most if the carry was awarded before you moved. This needs a case-by-case review. 

Are RSUs or deferred bonuses taxable in the UK if they were granted before I moved? 

These are not automatically exempt just because they predate the move. The grant date, vesting date and the workdays during the earning period all affect the answer. 

What records should I keep before and after relocating? 

At minimum: UK and non-UK workdays, the purpose of overseas travel, and the vesting/earning periods for bonuses and equity awards. Exactly what else matters depends on which reliefs you’re likely to claim. 

How Gerald Edelman can help 

A UK move can be exciting, but it should be planned carefully where complex investment, employment or fund interests are involved. 

At Gerald Edelman, our International Tax team advises internationally mobile individuals, executives and families on UK residence, pre-arrival planning, the FIG regime, Overseas Workday Relief, carried interest, offshore structures and UK tax reporting. 

If you are considering a move to the UK, or have recently arrived, please contact us to discuss how the UK tax rules may apply to your circumstances.