HPT Group 2025: Key Themes, Client Outcomes and What We Are Watching in 2026

A Year of Regulatory Acceleration

2025 was a year in which the regulatory frameworks that had been announced, debated, and legislated over the preceding three years moved decisively into implementation and enforcement. For HPT Group and our clients, this meant a year of intensive advisory work — restructuring, compliance, and strategic repositioning across every major offshore jurisdiction.

This review sets out the key themes that defined our advisory practice in 2025, the outcomes we achieved for clients, and what we expect will shape the offshore and international structuring landscape in 2026.

Theme 1: UAE Corporate Tax — From Theory to Practice

The UAE's Federal Decree-Law No. 47 of 2022 introduced corporate tax effective from June 2023, but 2025 was the year that the Qualifying Free Zone Person (QFZP) regime was tested in practice. The Federal Tax Authority issued extensive guidance throughout the year, narrowing the path to 0% taxation and raising the substance requirements for qualifying status.

What We Did

HPT Group assisted clients with:

• Restructuring free zone operations to meet the enhanced substance requirements for QFZP status
• Analysing the de minimis threshold (5% of revenue / AED 5 million) and advising on revenue stream classification to maintain qualifying status
• Advising on the Domestic Minimum Top-Up Tax (DMTT) introduced for large MNE groups, helping affected clients model the interaction between the DMTT and existing QFZP structures
• Transitioning clients whose structures no longer qualified for the 0% rate to alternative jurisdictions or restructured UAE arrangements

The Takeaway

The UAE remains a highly competitive jurisdiction for genuine commercial operations, family offices, and mid-market businesses. For large MNE groups subject to Pillar Two, the DMTT has eliminated the tax differential — but the UAE's commercial infrastructure, treaty network, and lifestyle proposition continue to attract clients for reasons beyond taxation.

Theme 2: UK Non-Dom Reforms — The Great Restructuring

The abolition of the remittance basis for non-UK domiciled individuals, announced in the October 2024 Budget and effective from April 2025, generated the most significant advisory demand HPT Group has experienced. Clients who had relied on the remittance basis for decades were required to fundamentally reassess their UK presence and structuring.

What We Did

• Advised clients on the four-year Foreign Income and Gains (FIG) exemption and whether continued UK residence was appropriate
• Modelled the Temporary Repatriation Facility (TRF) for clients with accumulated foreign income and gains, identifying optimal remittance strategies at the 12% transitional rate
• Restructured offshore trust interests to take advantage of the transitional protection for pre-30 October 2024 trust settlements
• Assisted clients relocating from the UK to the UAE, Monaco, Switzerland, Italy, and Portugal, co-ordinating with local advisors in each destination jurisdiction
• Reviewed inheritance tax exposure under the new ten-year departure tail, advising on the timing and structuring of UK departures

The Takeaway

The UK remains an attractive residence for many non-doms during the four-year FIG window, but the post-FIG tax burden (worldwide taxation on the arising basis, plus IHT exposure with a ten-year tail) has made long-term UK residence significantly less attractive for internationally mobile UHNW individuals. The relocation pipeline remains active.

Theme 3: BVI and Cayman — Substance Enforcement Intensifies

2025 saw the BVI International Tax Authority and the Cayman Tax Information Authority move from guidance to enforcement. Entities that had filed economic substance returns claiming compliance but lacking genuine substance received formal notifications and financial penalties.

What We Did

• Conducted substance audits for client entities in both jurisdictions, identifying deficiencies before the regulatory authorities
• Arranged substance packages with local service providers — dedicated employees, office space, and management services
• Relocated board meetings and decision-making functions to the relevant offshore jurisdiction
• Advised on the strategic dissolution or redomiciliation of entities that could not realistically demonstrate substance
• Managed the spontaneous exchange of information process for entities that received substance failure notices

The Takeaway

Shell structures — entities with no employees, no premises, and no local decision-making — will not survive enforcement in either jurisdiction. The cost of maintaining genuine substance must be weighed against the benefits of the structure. For many clients, consolidating entities and maintaining fewer, better-substantiated structures was the right answer.

Theme 4: Pillar Two — First-Year Compliance

For our clients with MNE groups above the EUR 750 million threshold, 2025 was the first year of Pillar Two compliance reporting. The data collection and computational requirements were substantial.

What We Did

• Co-ordinated with clients' tax and finance teams to collect entity-level financial data across multiple jurisdictions
• Applied the transitional CbCR Safe Harbour tests to identify jurisdictions where full GloBE calculations could be avoided
• Calculated ETRs for jurisdictions where safe harbours were not available, identifying several jurisdictions with unexpectedly low effective rates due to tax incentives and timing differences
• Advised on QDMTT filing obligations in jurisdictions that had adopted domestic top-up taxes (UAE, Singapore, Hong Kong, Switzerland, UK)

The Takeaway

The transitional safe harbours provided welcome relief, but they expire after 2026. Clients must invest now in the data infrastructure and computational tools needed for full GloBE compliance from 2027 onward.

Theme 5: CRS and CARF — The Transparency Net Tightens

The Common Reporting Standard continued to expand, with additional jurisdictions activating bilateral exchange relationships in 2025. The OECD's Crypto-Asset Reporting Framework (CARF) advanced toward implementation, with the EU's DAC8 directive requiring member state implementation by the end of 2025.

What We Did

• Ensured that all client structures were fully compliant with CRS reporting obligations in every relevant jurisdiction
• Advised clients on the implications of CARF for crypto assets held in offshore structures, including the reporting obligations that will apply when CARF exchanges commence
• Reviewed self-certification documentation for all client financial accounts to ensure accuracy and completeness

Theme 6: Caribbean CBI — Programme Evolution

The Caribbean citizenship by investment programmes continued to evolve in 2025, with increased due diligence requirements, higher minimum investments, and growing US scrutiny:

What We Did

• Guided clients through applications in Dominica, St Kitts and Nevis, and Grenada, with particular attention to enhanced due diligence requirements
• Advised clients on the travel utility and tax planning applications of Caribbean citizenship
• Monitored the US CBI Integrity Act and its potential implications for existing citizenship holders

What We Are Watching in 2026

Pillar Two Safe Harbour Expiry

The transitional CbCR Safe Harbours expire for fiscal years beginning after 31 December 2026. This will trigger a step-change in compliance complexity for all in-scope MNEs.

UTPR Expansion

As more jurisdictions implement the Undertaxed Profits Rule, MNEs with parent entities in non-adopting jurisdictions (particularly the United States) will face increasing top-up tax exposure collected by other jurisdictions.

AMLA Operational Launch

The EU's Anti-Money Laundering Authority becomes fully operational in 2025-2026, with direct supervision of high-risk cross-border obliged entities commencing. The impact on banks, TCSPs, and financial institutions serving offshore clients will be significant.

UK IHT Transitional Provisions

The first ten-year anniversary charges on trusts affected by the April 2025 IHT reforms will crystallise in the mid-2030s, but planning for these charges must begin now.

Continued Substance Enforcement

BVI, Cayman, and other offshore jurisdictions will continue to intensify economic substance enforcement. The convergence of substance requirements, Pillar Two SBIE, and FATF evaluations creates a consistent message: genuine activity is rewarded; shell structures are not.

Key Takeaways

• 2025 was defined by the implementation and enforcement of regulatory frameworks announced in prior years
• UAE QFZP, UK non-dom reforms, BVI/Cayman substance enforcement, and Pillar Two compliance were the four dominant advisory themes
• The offshore structuring market is not shrinking — it is evolving toward structures with genuine substance, legitimate commercial rationale, and full regulatory compliance
• The advisory skill required is no longer identifying low-tax jurisdictions; it is designing structures that achieve commercial objectives within the constraints of the new regulatory environment
• HPT Group's advisory practice is positioned for the 2026 landscape: compliance-intensive, substance-focused, and multi-jurisdictional