Capital Gains Tax reforms; are you prepared?
New legislation (Finance Bill 2018-2019) is progressing and likely to come into force in 2019 that will affect the way gains from the sale of property are taxed for non-resident UK property owners. This is an expansion of the existing provisions, which will capture commercial real estate.
The legislation will also mean that by April 2020 non-UK resident companies will pay corporation tax on their gains from disposals of interests in UK land, with the abolition of the charge to capital gains tax (CGT) on gains arising on disposals of residential property chargeable to the annual tax on enveloped dwellings (ATED-related gains).
There is much to think about in Q1 2019 for investors into the UK, given the significant political deadline looming.
It should, however, not be lost that a large number of non-resident UK commercial property owners will now also fall within the scope of CGT. Such investors will need to consult their tax accountants to register for and set up systems to calculate and pay this new tax on any asset dispositions into the future. It is likely also that investors will require the assistance of property valuers to establish a formal Market Valuation at the rebase date of 5th April 2019.
As you are planning ahead should this apply to you please get in contact to discuss your potential needs in more detail.