insideKENT Magazine Issue 39 - June 2015 | Page 157
LAW
PROPERTY OWNERSHIP
ABROAD
Owning a property abroad is a dream
come true for many, providing a
home from home where it is possible
to escape from the rigours of daily
life. With the current strength of
Sterling against the Euro many people
may be considering purchasing that
longed for property abroad, and once
the property search has begun it is
easy to get swept along in the
process. However, it is important that
anyone owning or looking to own
property in another country
understands the legal and tax position
of that property ownership to avoid
the dream turning into a nightmare.
Kate Arnold
If you are buying or selling, it is vital to get clear advice from suitably qualified
professionals either in the UK or in the location where the property is.
Language barriers can cause confusion and misunderstandings leading to
long-term problems, which may impact on your ability to enjoy the property.
Understanding the process and all documentation at each step will ensure
you agree only to terms you are willing to accept. You should carry out
research before you start your search for a property and find a notary or
lawyer on the ground that has experience in dealing with English people
purchasing in their region – doing so will prove invaluable as you progress
through the process.
The tax implications of owning property abroad, and disposing of it, can
be complicated. Capital gains tax may be payable on a sale if the property
is your second home; rental income may need to be reported both in the
local country and in the UK; and the property is likely to be subject to
inheritance tax or its equivalent in both countries. Certain countries may
charge a separate gift tax and available exemptions and allowances vary
from country to country.
Roger Holman
country. If someone dies after 17th August this year, they may be able to
choose between the succession law of the country of their habitual residence
or that of their nationality, which can assist them in directing their assets
as they wish. There are a number of factors that must be taken into account
in identifying how this regulation will apply to any individual, and professional
advice is strongly recommended.
The key is to ensure that your advisers have the appropriate specialisms
and work together to provide cohesive advice. Cripps has a dedicated
international team advising individuals on taxation and legal issues arising
from owning property outside the UK. By working closely with MarcAlliance
partners, an international network of legal and tax experts, Cripps will ensure
you have access to the full range of advice you may need in different
jurisdictions.
For further advice or information, please contact:
Kate Arnold
Partner
T: 01892 506 337
E: [email protected]
While concern about the tax implications should not be a reason to hold
you back from a purchase, understanding them ensures you are not caught
unaware and that you can plan ahead. Fortunately, the UK has a wide
network of double tax treaties, which ensure that