Indirect disposals of interests in UK land by non-residents

Produced by Tolley in association with of Crane Dale Tax, part of AMS Group

Corporation Tax

Guidance

UK property is often held by non-resident persons indirectly, typically through the holding of shares in a company that in turn directly owns the property. For corporate groups, this form of ownership of UK property is very common, with property holding companies often established in such circumstances. Prior to 6 April 2019, these types of indirect disposals by non-residents were not commonly within the scope of UK corporation tax.

However, from 6 April 2019, disposals of shares (or similar interests) in ‘property rich’ companies are subject to tax. This applies to disposals of shares in companies with commercial or residential property. The legislation is drafted with reference to a right or interest in companies that are ‘property rich’, but also includes entities deemed to be companies, such as offshore collective investment vehicles who fall within the definition of company for these purposes. For more on the rules that apply to collective investment vehicles, see Simon’s Taxes C2.1165.

In context, if the company

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Rob Durrant-Walker

Tax Director at Crane Dale Tax , Corporate Tax, OMB, Personal Tax

Rob is a cross-tax advisor with a particular focus on property tax planning, and business structure planning for OMB’s. He provides tax advice to other accounting firms, balancing commerciality, ethics, and understanding complexity. His 30+ years of experience start at the Inland Revenue in Hull. After completing his ATT and CTA by 1999 with PKF, he subsequently worked at KPMG and UHY prior to managing the business tax team as a director at Garbutt + Elliott. Rob is now Tax Director at the independent tax consultancy, Crane Dale Tax. He is a regular author for Taxation magazine with many articles and Readers Forum contributions since 2005, and he contributes as a virtual member to the CIOT Property Tax technical committee. Rob works remotely from Vancouver in Canada.

Popular Articles

Corporation Tax

Substantial shareholding exemption ― overview

Substantial shareholding exemption ― overviewThe substantial shareholdings exemption (SSE) provides a complete exemption from the liability to corporation tax on the gains generated from qualifying disposals of shares and interests in shares by qualifying companies. No claim is required. Provided

14 Jul 2020 13:44 | Produced by Tolley Read more

Personal Tax

Timing of disposal for capital gains tax

Timing of disposal for capital gains taxDate of disposalThe date of the disposal determines the period in which the gain is subject to capital gains tax (CGT). When the rates of CGT change, the determination of the date of disposal can also affect the rate of CGT that applies to the gain.See the

14 Jul 2020 13:50 | Produced by Tolley Read more

Year-end tax planning

Owner-Managed Businesses

Sales, advertising and marketing

Sales, advertising and marketingExpenditure on sales, advertising and marketing activities may include amounts which are disallowable for the purposes of calculating trading profits. This may be because the expenditure is:•capital in nature (see the Capital vs revenue expenditure guidance note)•not

14 Jul 2020 13:28 | Produced by Tolley Read more

��Ƶ