Carter Jonas
Carter Jonas

Overseas owners need to prepare for major Capital Gains Tax reform

Changes to the Capital Gains Tax (CGT) regime for overseas owners of UK residential property were first proposed in the 2013 Autumn Statement by George Osborne and were then subject to a consultation that closed in June last year.

In the interim, you may have forgotten the topic but the Government published a response to the consultation on November 27, although it was soon overwhelmed in property news channels by sweeping changes to Stamp Duty Land Tax (SDLT) announced by Mr Osborne in his 2014 Autumn Statement.

However, the reality is that major changes affecting CGT that apply to the disposal of properties in overseas ownership come into effect on April 6 this year with the start of the new 2015-2016 UK tax year – they are in the Finance Bill 2015 currently progressing through Parliament to implement tax changes for the 2015-16 fiscal year.

It’s important to remember that there is still time if this change will affect you to plan your tax affairs efficiently – avoidance may sometimes be legal, even if regarded as morally questionable, but evasion is an offence.

You need to talk to your professional accountancy and tax advisers to find out how this change will affect you but the important thing to remember is that the charge only applies to increases in capital value accruing from April 6, 2015, onwards or the date of acquisition if later.

There are various ways in which the CGT liability can be mitigated through different methods of holding the assets in ownership and each needs very careful examination to see which will best suit your circumstances.

With the recent significant rises in property values, especially in London, it would perhaps be wise to have a current valuation of the property to hand as the new tax year starts.

Carter Jonas has wide experience of the residential property market for both owner-occupied and let properties and we will be happy to arrange a full professional valuation of your residential property holdings in advance of the tax system changes.

Graham James

Graham JamesMRICS FAAV


Graham is attached to the Commercial Division with his brief and work types being cross-divisional, working principally in the south and south-west region. His professional specialism is valuation...

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