The number of millionaires in the UK is at its lowest point since the financial crisis of 2008

According to research from the Adam Smith Institute, the wealthy are being negatively impacted by high taxes and the unstable financial and real estate markets

According to new research, the number of British millionaires has reached its lowest point since the financial crisis.

According to analysis by the think tank Adam Smith Institute (ASI), a number of factors have affected people's wealth, including high taxes and slowing growth in home prices.

There were 442,000 sterling millionaires in Britain last year, according to the most recent data from its Millionaire Tracker, a 7% decrease since 2024.

Falling real asset prices, a low household savings rate, and the emigration of high net worth individuals (HNWIs) due to the elimination of non-dom status and concerns about a wealth tax have all been blamed for this.

Watch the entire video here: The ASI is urging the government to improve the tax environment for wealth creators in order to buck this trend. They have proposed, in particular, the elimination of inheritance tax, reductions in capital gains tax, and an evaluation of the UK's tax and regulatory policies for non-doms and HNWIs in terms of international competitiveness.

Economist Mitchell Palmer of the Adam Smith Institute stated: "Some on the left may see the drop in millionaires as a victory, but it should be seen as a warning sign. Every millionaire who departs results in less money for British companies, fewer connections abroad, and a decline in the country's entrepreneurial spirit."

Why is the number of millionaires in the UK declining?

The ASI calculates the number of constant-price sterling millionaires using data from the Office for National Statistics.

A constant-price sterling millionaire is defined as an adult British citizen with a net worth of at least £1 million, measured in constant 2025 prices, across all real and financial asset classes, including property and pensions.

442,000 is the lowest number since the financial crisis of 2008.

This number has decreased due to a number of factors.

The ASI stated: "The inflation-adjusted values of pension pots and upscale London real estate have mechanically decreased due to rising interest rates and a lack of confidence in the British economy.

Furthermore, Britain's low savings rate has slowed the rate at which households become millionaires. Lastly, and perhaps most worrisome, there has been a well-documented trend of wealthy people choosing not to relocate to Britain or leaving the country."

The ASI stated that a hostile culture for wealth creators, high levels of general taxation, and the elimination of non-dom tax status are some of the reasons why millionaires are fleeing the nation.

Additionally, the think tank cautions that proposals for a wealth tax are unwise.

It stated: "After witnessing significant outflows of millionaires or other avoidance behavior, France, Austria, and the Netherlands all gave up theirs. We could only anticipate similar outcomes given that Britain is already losing wealth.

"Every millionaire who departs represents a loss to the nation. Millionaires of both foreign and British descent contribute jobs, money, connections, and ideas to this nation, which can significantly increase the wealth of other Britons."

According to the think tank, the top 1% of earners already pay a disproportionate amount of taxes29.1% of income tax.

"Recent anti-wealth proposals, like a wealth tax or equalizing the capital gains tax rate with income tax, will only make this problem worse," Palmer continued.

The government should instead concentrate on making Britain a desirable location for aspirational individuals to accumulate and retain wealth. This includes reducing or doing away with the capital gains and inheritance taxes."

How are you going to safeguard your money?

Calls for higher taxes or a wealth tax may worry a lot of wealthy people.

According to Nouran Moustafa, practice principal at Roxton Wealth, more affluent clients are inquiring about ways to diversify or safeguard their wealth outside of Britain, and some are even thinking about doing so.

"Those concerned about protecting wealth should avoid panic," she stated. They should examine estate planning, pensions, tax wrappers, diversification, and liquidity while maintaining a strategy that is adaptable enough to withstand future changes in policy."

"For those staying, the answer isn't panic but planning: diversify globally, use every available tax allowance, review estate and succession planning, and avoid irreversible decisions based on short-term headlines," said Paul Denley, chief executive of Oakham Wealth Management. Wealth is typically lost gradually rather than all at once as a result of bad choices."