There are no restrictions on foreigners for purchasing real estate in the United Kingdom, neither are there any restrictions on foreign companies for acquiring UK real estate. Also, is still possible in the UK to gain tax advantages by purchasing and holding real estate through a foreign tax-free company and thereafter making any subsequent transfer of the real estate by transferring the shares in the real-estate owning company, thus leaving the title to the UK real estate unchanged. The use of foreign companies based in no-tax jurisdictions for real estate holdings is not uncommon and indeed brings numerous advantages to the foreign owner.
Generally, a non-resident cannot be liable for capital gains tax unless he/she carries on a trade in the UK through a branch or agency. A company incorporated in a suitable no-tax jurisdiction may purchase UK property and pay no tax on any gain made on the ultimate sale, as no transfer and no capital gains then arises in the UK. Likewise, if the real estate is owned by a company, neither the company nor its owner will be subject to any UK inheritance tax.
Real estate can also be transferred indirectly by transferring shares of the foreign real-estate holding company. This still enables the stamp duty, which is otherwise charged at between 1% and 4% of the real estate value, to be avoided.
Advice on acquisition of UK real estate
The acquisition of real estate abroad requires careful and professional planning. Every day, individual clients as well as other law and consulting firms worldwide rely on us for specialised advice in this area. No matter how complex your needs are, Henley & Partners will be able to advise and assist you. Contact us today for individual advice and comprehensive, yet cost-effective solutions regarding the acquisition and holding of real estate in the United Kingdom.
