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Autumn Statement Preview: Osborne's Plan to Tax Foreign Property Owners
- AuthorStephanie Brobbey
It is reported that George Osborne is considering imposing capital gains tax (“CGT”) on foreign property owners in an attempt to curb soaring house prices in and around the capital.
The new development would follow on from a series of changes affecting property ownership and taxation introduced by the Chancellor in last year’s Budget and implemented earlier this year. Speculation in national newspapers suggests that the Chancellor may seek to levy a tax on overseas investors amid concerns that they are fueling a bubble in the London property market.
UK residents currently pay CGT at 18% for the basic rate taxpayer or 28% for the higher rate taxpayer when they sell a property that is not their main home. Non-residents are exempt from paying CGT which allows them to buy and sell UK property without paying any tax on the proceeds of sale. In a response to the Chancellor’s alleged plans, Business Secretary Vince Cable said it was an “extraordinary anomaly” that UK citizens were liable for the tax but foreigners were not.
The Chancellor, who has refused to comment on whether a final decision has been made, is due to present his Autumn Statement on 4 December.
This guide is for general information and interest only and should not be relied upon as providing specific legal advice. If you require any further information about the issues raised in this article please contact the author or call 020 7404 0606 and ask for your usual Goodman Derrick contact.