From The Telegraph:
George Osborne will this week announce plans to squeeze hundreds of millions of pounds of extra tax revenue to fund giveaways such as cuts in fuel prices, free school meals and married couple's tax breaks.
Much of the money will come from tighter rules applied to people the Chancellor described this week as "not your average taxpayer". But lawyers and accountants said the rules could affect many who could not be described as rich...
Experts last night warned that many British middle-class professionals will be caught up in a Treasury scheme to charge capital gains tax on UK property sold by overseas nationals and expats. The measures, to be announced in the Autumn Statement, are designed to hit wealthy foreigners buying and selling property in the UK.
However, the plan would also apply to British people living abroad and who are classed as non-resident here, but who still own property in the UK. Approximately five million Britons live abroad.
Jeremy Cape, tax partner at Denton, said: "It's impossible to tell how many British citizens abroad will be affected by this possible change. Potentially the largest class will be those who retired a decade or so ago to a warmer climate, but held on to their UK homes.
FFS, why do they assume that expat's are all "middle-class professionals"? In the very next sentence they say that the bulk of those potentially affected are retired, so not "professionals" any more. What do these people want? A tax only payable by working class people?
And if somebody has retired abroad and still owns a home here, then either it is standing vacant for occasional visits or it is rented out.
If it is vacant, then the vendor is not being "squeezed" if he sells it - he ends up with a big pile of cash with or without CGT on it. And if it is rented out, well it's a business asset and so there's no reason not to tax it.
NB, the UK is unusual in that it has hitherto exempted capital gains made on UK land and buildings owned by foreigners.
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6 comments:
NB, the UK is unusual in that it has hitherto exempted capital gains made on UK land and buildings owned by foreigners.
Are you serious? OTOH the overtness of the UK governments insistance of funneling all productive investment to rentierism, should cease to amaze me now.
Kj, yes, until a few months ago, capital gains made by foreigners holding UK land as pure investments were not taxed here (but the income is). They are now trying to tax this, that and the other but only at the margins.
It is only if a foreign business has a UK branch or presence and owns its own premises in the UK, the capital gain on that is very much taxable just like for a UK business.
"What do these people want? A tax only payable by working class people?"
Got it in one!
"British people living abroad and who are classed as non-resident here,"
Presumably non-resident means non-taxpayer? If so, it just shows, no-one has a sense of decency any more. It's all "can I get away with it," not "should I do it?"
Also, if they are resident abroad, they can hardly claim it's their main residence, can they, so they would be liable for CGT even if they lived here but not in that house. So what Mr Cape and the other paid shills, sorry, experts are actually complaining about is a loophole that allows expats to claim (one of) their UK house(s) as their "main residence" when in reality it's no such thing.
B: "Also, if they are resident abroad, they can hardly claim it's their main residence, can they, so they would be liable for CGT even if they lived here but not in that house."
From what I understand, the concept of "main residence" does (did) not apply to anyone living abroad - they were exempt from CGT full stop.
Should have got my step dad to buy (in name) my house, and then we could sell it just before the rules change. I hate homeownerism as much as MW, but when it stands to make my family very much richer, I don't care if you call me a hypocrite!
If an expat leaves their house empty while they live abroad, that's something that needs to be punished, not squealed about!
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