Posted by James Pearson on 19 Nov 2013
Non-Resident Property Owners
Reports in the media suggest that George Osborne will be announcing on 5 December 2013 during his pre-budget speech, changes to the rules on selling a property by non-resident property owners and individuals. The proposal appears to be a gesture designed to placate part of the coalition who have been seeking a mansion tax on properties worth £2m or more.
The proposals suggest that where an individual whether or not overseas for temporary work purposes or a non-UK national, sells UK residential property, any profit could be taxed as a capital gain. This could result in those individuals working temporarily overseas being taxed on the sale of a house whereas previously such a sale would have been exempt and, similarly, an overseas investor could be taxed on what might previously have been an exempt transaction.
Any such proposals would be very difficult to implement in law. Firstly, there is the question of how the property would be defined and whether or not the principal private residence applied and, secondly, the impact of double taxation relief. For many individuals living in a country which has a double tax treaty with the UK, the sale of the property at a profit would not be a taxable gain in the UK in the terms of the treaty.
This seems to be a highly speculative proposal which seems to have more of a political message than having any expectation of being introduced in reality. Of course, if you are concerned as to how a UK property might be affected by UK taxation if you are a non-UK national or non-UK tax resident, then contact us for further advice.
If you would like any advice regarding the above article or would simply like to discuss other ways in which we could help you or your business, please contact us on 01962 856 990 or firstname.lastname@example.org.
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