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A guide to understanding the English concept of Domicile and its practical application



Domicile stands as a cornerstone concept in English law, with implications affecting important matters such as residency, taxation, inheritance, and jurisdictional. Within the English legal landscape, domicile manifests in three primary forms: domicile of origin, domicile of choice, and domicile of dependence. It is paramount for both individuals and legal professionals to navigate the intricate pathways of residence and its legal implications.


In this comprehensive blog post, we Lopez & Moreno Associates, in our capacity of Spanish lawyers and English Notaries are able to explain these English law concepts for the Spanish reader to have a smooth understanding. We will go through each domicile type, dissecting their characteristics, legal ramifications and pragmatic impacts.

 

1. Domicile of Origin:

 

At the beginning of an individual's legal existence, the domicile of origin commences and is connected to family ties. While steeped in historical tradition, this principle has evolved over time to accommodate shifting societal norms. Domicile of origin serves as a fundamental legal status, wielding influence over diverse realms of an individual's life, including tax liabilities and inheritance rights, regardless of their current residence.


You acquire a domicile of origin at birth and this is the same as the domicile of your father at that time, that is, the country that your father considered to be his permanent home at the date of your birth. As a result, your domicile may not be the country where you were born.


If your parents were not married when you were born, you will take your domicile from your mother. If you are adopted, you take your domicile from your adopted father – if there is no adopted father, you take the domicile from your adopted mother.


It is very difficult to displace your domicile of origin. Indeed, your domicile of origin is retained permanently, unless it is superseded by a domicile of dependence or a domicile of choice (see the headings below). Your domicile of origin also returns if you acquire a domicile of choice which then ceases but you have not yet made a new domicile of choice.


Most migrants to the UK are likely to have a domicile of origin outside the UK, meaning that they are not domiciled in the UK. Unless you choose to remain in the UK permanently or indefinitely and sever ties with your original country of domicile or origin, you will probably continue to be not domiciled in the UK.

 

However, if you were originally born in the UK or if you remain in the UK for more than 15 years, then you will be deemed to be domiciled in the UK (see below).

 

There are other factors that can be taken into account to determine whether or not your domicile has shifted: acquisition of UK nationality, known intention (by means of material evidence) to remain in the UK, having children and buying a house in the UK, owning a business, etc. All your personal factors may be accounted for to establish what your domicile is.

 

2. Domicile of Dependence


Until you reach the age of 16, your domicile follows that of the person on whom you are legally dependent, typically the parents or legal guardians for minors – if that person changes their domicile (through choice) then yours will also change.


An interesting point is that if you were married before 1 January 1974, the wife would automatically acquire the domicile of her husband.


This paradigm furnishes a framework for addressing legal quandaries concerning dependent individuals, encompassing inheritance rights and guardianship arrangements.

 

3. Domicile of Choice


The concept of domicile of choice empowers individuals to sculpt their legal residency through conscious intent and action. Attaining a new domicile of choice requires a tangible manifestation of commitment to a jurisdiction, marked by physical presence and a genuine resolve to establish permanent roots, as explained above. This transformation entails disentangling from prior domiciliary connections while forging substantive ties with the chosen domicile. However, this is not straightforward, especially in matters concerning taxation and inheritance, which demand scrutiny of an individual's sincerity and actions by legal authorities.


Therefore, from the age of 16 (earlier in Scotland), an individual may be able to acquire a new domicile (domicile of choice). Now, to acquire a domicile of choice, you must be able to demonstrate all of the following:


  • You have settled permanently in the country in which you now consider yourself domiciled.

  • You must intend to stay there for the rest of your life.

  • Generally, you must break your ties with the country of your domicile of origin. You do not necessarily have to become a UK citizen or passport holder but these factors will be taken into account.


You will have to prove that you have chosen to live in the new country on a permanent basis and provide strong evidence of your intention to stay there permanently or indefinitely.


Factors such as your intentions (for example, where you intend to retire), your Will and Testament, your permanent place of residence, and your business, social and family commitments will be taken into consideration when looking at whether you have acquired a domicile of choice.


If you have a non-UK domicile of origin and you later acquire UK citizenship, then HMRC may take this as an indicator that you have acquired a UK domicile of choice for tax purposes. Claiming non-domiciled status after becoming a UK citizen therefore may carry a higher risk of challenge by HMRC.


In most cases it will be fairly obvious what your domicile status is, but it can be very complex in some cases. If a lot of tax is at stake, you should seek professional help.


Practical Implications and Challenges:


Whereas it may seem easy to distinguish the different types of domiciles, their application is full of hurdles. Disputes stemming from domicile often erupt amidst international migrations, complex family disputes over inheritance rights, or attempts at manipulating domicile for tax mitigation.

 

Legal practitioners are tasked with meticulously evaluating evidence provided by those asserting a change in domicile, weighing factors like duration of residency, depth of connections established, and genuineness of intent.

 

In summary, the tripartite domicile framework—comprising domicile of origin, domicile of choice, and domicile of dependence—lays the groundwork for comprehending and adjudicating an individual's enduring legal residence. Each variant carries its distinctive legal implications and pragmatic consequences, assessing an individual's life journey, from fiscal responsibilities to testamentary dispositions.


The domicile that involves more discussions is obviously the domicile of choice. Establishing someone’s domicile of choice demands a wide comprehension of legal precepts and a discerning analysis of individual circumstances.

 

Amidst the evolving legal landscape, domicile still remains a source of jurisdictional deliberations, underscoring the imperative in favour of a judicious approach.


At Lopez & Moreno Associates, our team of experienced Spanish lawyers and notary can guide and advise you on every step of the process.


Please get in touch with us for information about our services and fees.

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