Update

"Taxing gains made by non-residents on UK immovable property" - some thoughts on the HMRC and HMT consultation

Following the UK Budget on 22 November 2017, UK HM Revenue & Customs (HMRC) and HM Treasury (HMT) published a consultation document entitled "Taxing gains made by non-residents on UK immovable property". The central thrust of the proposals, to apply capital gains tax (CGT) to non-resident's gains on UK commercial property for the first time since the introduction of CGT in 1965, took the market by surprise, particularly in light of the April 2019 implementation date, just as Brexit takes effect.

The charge will arise not only in relation to disposals of direct holdings of UK commercial property but also, in some cases, to "indirect" disposals of 25%+ interests in "property rich" holding vehicles such as companies, partnerships and unit trusts. This briefing looks at the rationales for the proposed changes, some key areas of concern and some potential solutions.

Responses to the consultation must be submitted by 16 February 2018.