High net worth individuals (HNWI) expect the number of wealthy people leaving the UK to continue increasing over the next three years, according to research by Wealth Club.

Its study found that 86 per cent of Wealth Club clients believed the trend of wealthy people leaving the UK for tax purposes would rise over the next three years, with 39 per cent expecting a dramatic increase.

More than a fifth (22 per cent) said they had wealthy friends or associates who left the UK in the past two years due to higher taxes.

The same proportion said they were considering leaving the UK and moving abroad themselves.

The top financial reason for leaving the UK was higher taxes, cited by 86 per cent of respondents, while 48 per cent mentioned slow economic growth in the UK.

Nearly a third (32 per cent) pointed to the increased cost of running a business, while 28 per cent were concerned about London’s loss of status as a financial hub.

The primary non-financial reason for leaving the country was political concerns, cited by 69 per cent of HNWIs, while 61 per cent highlighted lifestyle and crime worries.

The most popular destination for HNWIs leaving the UK was Portugal, picked by 17 per cent, while 12 per cent chose the Channel Islands or the Isle of Man, and just 7 per cent picked the UAE.

Over a fifth (22 per cent) of those thinking about relocating expected to save at least £100,000 in tax in their first year abroad, while 8 per cent expected to save more than £500,000.

“Wealthy people are increasingly leaving the UK because of taxation issues, and wealthy investors expect the trend to accelerate,” said Wealth Club founder and chief executive, Alex Davies.

“An exodus of the wealthy is bad news for government tax revenues, both short and long term. The top 1 per cent of UK taxpayers pay a third of all income and capital gains tax. Last year alone, just 100 individuals contributed £4.1bn. If even one leaves, that’s a big hole in the public finances.

“Longer term, anyone who leaves doesn’t just stop paying tax here - they stop shopping, setting up businesses, employing people, buying houses and investing.

“And it’s not just about higher taxes. Our research shows wealthy taxpayers feel the UK no longer welcomes success and is making it harder to run a profitable business. The government risks creating a culture that seems hostile to achievement.”

---