Foreign Money in UK Elections, What the Rycroft Review Reforms Actually Mean

The government has announced a major package of reforms to political finance rules, accepting in full the recommendations of the independent Rycroft Review. The changes introduce a time based cap on large donations from people who have recently moved to the UK, impose a profit based test on company donations, and require candidates to declare and prove the legitimacy of funding received before they officially become a candidate.

The reforms were announced on 6 July 2026 by the Ministry of Housing, Communities and Local Government, and will be legislated through amendments to the Representation of the People Bill, which returns to the House of Commons for Report Stage the week of 13 July.

The Rycroft Review was an independent examination of political finance rules in the UK, led by Philip Rycroft. Its purpose was to assess whether existing rules were sufficient to prevent foreign money from influencing British elections, and to identify where loopholes existed.

The government had already responded to an initial set of Rycroft recommendations in March 2026, introducing a hard cap on donations from overseas electors and announcing the ban on crypto donations. Today's announcement accepts the remaining recommendations in full.

The overseas donor cap in detail

The original cap applied to people registered to vote overseas. The revised rules go further. Anyone who moves to the UK from abroad, not just those previously registered as overseas voters, will be subject to the £100,000 donation cap for at least one full calendar year after arriving. The government says this closes a route by which the rules could have been avoided by individuals who were never registered as overseas electors but had nonetheless recently relocated from abroad.

Under existing rules, companies could demonstrate eligibility to donate partly through revenue figures. The Rycroft Review, along with the Electoral Commission and the Committee on Standards in Public Life, recommended switching to a profit based test instead.

From when the new rules take effect, company donations will be assessed against post tax profits over the previous five years. The government argues that a revenue based test could allow a business with high turnover but no UK tax liability, or limited genuine UK operations, to donate. A profit based measure, it says, is a clearer indicator of real economic activity in the UK.

These requirements build on the framework already set out in the Representation of the People Bill, which requires companies making donations to demonstrate a genuine connection to the UK or Ireland.

One of the more significant structural changes involves money received by candidates before they formally enter an election race. At present, donations received before the regulated election period are not subject to the same declaration requirements as those received during it. That means funding from potentially illegitimate sources could, in theory, go undeclared and later be used to support a campaign.

Under the new rules, candidates will for the first time be required to prove that precandidacy funding came from legitimate sources. They will also need to declare any donations above £2,230 received before they officially become a candidate. The threshold mirrors existing in period declaration requirements and is intended to bring precampaign funding into the same transparency framework.

The government said the package responds to what it described as increasing threats from foreign state actors, overseas donors, and front organisations attempting to influence British politics. Announcing the measures, Communities Secretary Steve Reed MP said the rules would "shut down dodgy funding, stop foreign money influencing our elections and keep our democracy strong."

Minister for Democracy Samantha Dixon MP said the reforms were aimed at closing loopholes without burdening the "overwhelming majority" of people who participate honestly in the democratic process.

Chief Secretary to the Prime Minister Darren Jones MP added that the government intended to ensure anyone seeking to donate to UK politics had "legitimate and longstanding roots in our country."