British citizens living abroad are to be barred from claiming legal aid in England and Wales as part of a cost-cutting crackdown unveiled by the Government today.
The restrictions form part of a reform package ministers said would shave £6 million a year from the £2 billion annual bill for the taxpayer-funded help.
Measures coming into force in April will also offer parties in divorce and custody battles a stronger chance to complain that their opponents are not eligible for state aid.
But the Ministry of Justice (MoJ) was forced to abandon other plans, including axing legal aid for small-scale claims, amid outcry from legal and civil liberties groups.
The right for foreign nationals to apply for legal aid - including holidaymakers and litigation tourists - was targeted last year by the Government as it looked for ways to cut costs.
Campaigners complained it could hit asylum seekers and human trafficking victims, prevent human rights challenges against the UK and be in breach of discrimination laws.
Under revised proposals, immigration and asylum cases will be excluded from the bar which will apply to anyone living outside the EU, British Overseas Territories, Crown Dependencies, Macao or Hong Kong - or countries with a reciprocal deal: Algeria, United Arab Emirates and Libya.
And in a reversal of the original plans, British citizens resident outside those countries would also be refused legal aid for cases in English and Welsh courts.
Only immigration, asylum, child abduction, forced marriage, emergency housing and mental health cases will be exempt from the new rules.
Funding for human rights challenges will be decided on an "exceptional basis" by the Legal Services Commission, independently of government ministers.
Responding to a consultation on its proposals, the MoJ said that the "vast majority" of responses were opposed to most of its proposed reforms.
Among the abandoned proposals was stopping legal aid being paid for cases likely to result in damages of less than £5,000.
Critics said the amount of money involved was less important than the chances of the case establishing important precedents or stopping abuses by public authorities.
But the MoJ said it would press ahead with moves - although now in a staged introduction - to inform parties of opponents' applications for legal aid - and suspend any payments for 14 days to allow any objections to be checked, including cross-referencing with state benefit payment records.
At present it is up to individuals to put forward such concerns.
Family cases such as divorce and child custody battles will be the first affected - but not domestic violence or emergency proceedings.
"We consider that the 14 day window for opponents to make representations about financial eligibility balances the need to protect the fund against the need to ensure cases are progressed as swiftly as is possible," the MoJ said.
Legal Aid Minister Lord Bach said: "Civil legal aid provides critical support for the most vulnerable people on a range of important matters, from debt, housing, and employment advice to representation in important family and public law proceedings.
"The Government devotes very significant resources to civil legal aid. It is therefore important that we regularly look to ensure we're getting the best value for money and even more importantly that the people who need help most are able to get it.
"We were impressed with the representations received during the consultation and have made significant revisions to many of our original proposals.
"The changes we have announced will ensure that fraudulent applications are detected before public funds are expended on them, and that legal aid is better targeted."