The government has responded by introducing a charge for foreign investors selling properties in the UK. From April 2015, a CGT charge will be introduced on future gains made by non-residents disposing of UK residential property. A consultation on how best to introduce this will be published in early 2014.
This obviously has implications for individuals currently owning investment properties in the UK with a view to selling them in the future free of CGT. We have several clients in this situation and clients should consider whether it is appropriate to take action prior to April 2015 to mitigate their exposure. Of course, not all clients will be in a position to sell the property prior to April 2015. Other clients may have acquired property for a specific purpose, for example, accommodation for a child attending university here, and disposing of it isn't an option. Equally, for many, the property may still represent a good investment.
Consideration must be given to particular circumstances to establish whether measures should be put in place at this time. For some, an option might be to gift the property to a UK based trust, crystallising the gain prior to April 2015 and with the property then being occupied by a beneficiary of the trust enabling the trustees to claim Principal Private Residence relief on the eventual sale.
For others, the solution may be to gift shares in the property to other individuals thus providing the availability of several annual exemptions in due course.