On 18 January 2008, HMRC published the long awaited draft legislation and explanatory notes that will implement the proposed changes to the residence and domicile tax rules announced in the 2007 Pre-Budget Report.

Although the proposed changes were announced in the Pre-Budget Report and some further detail added by the consultation paper published on 6 December 2007, the precise extent of the proposed changes was unclear (particularly in respect of the changes necessary to amend the anti-avoidance legislation that does not currently apply to non-domiciled individuals). The draft legislation, explanatory notes and HMRC's frequently asked questions, help clarify the extent of the changes.

While the consultation period ends on 28 February 2008, comments on the draft legislation will be accepted after that date.