As expected, the Finance Bill released yesterday revealed details of the new Annual Residential Property Tax which is to apply to high-value (£2m+) UK residences owned by certain "non-natural persons". There are some sensible carve-outs as expected for property rental and development businesses, and the regime is largely unchanged from previous announcements.
The potential annual charges are as follows:
> £2 million but ≤ £5 million = £15,000
> £5 million but ≤ £10 million = £35,000
> £10 million but ≤ £20 million = £70,000
> £20 million = £140,000
Given the sums involved, this will clearly represent a significant headache for those with properties held through existing structures. It is also imperative that those contemplating investing in high-value UK residential property are properly advised to avoid unwelcome tax charges.
Those affected should now act fast to consider their options as the new regime will apply a tax charge on 1 April 2013 where the relevant conditions are satisfied.
Inevitably, there are pros and cons to consider in each case, so please contact us to discuss how this might affect you. We still await full details (now expected in early 2013) of the