A London estate agent who works closely with High Net Worth overseas buyers has hit out a proposed law which he describes as “a new obstacle” in the market.
The government’s new Registration of Overseas Entities Bill sets out provisions to establish a new beneficial ownership register of overseas entities that own UK property.
This follows a commitment made by the government at the Anti-Corruption Summit in 2016 to establish such a register, in order to combat money laundering and achieve greater transparency in the UK property market.
The Bill is currently out for comments from agents and other interested groups before a revised version is likely to be presented to Parliament next year.
Now Trevor Abrahmsohn of Glentree Estates says that whilst there was at one time a case for cleaning up the processes used by some overseas buyers, this latest piece of red tape may be a step too far.
“Out there in the real world with stamp duty at dizzy levels, very undesirable changes to UK Non Dom Residency in this country at its draconian best, with the uncertainty of the Brexit shadow, the last thing we should be doing at the moment, is introducing more red tape” he cautions.
“International residential property buyers are facing a 15% transaction charge by way of SDLT or, they could purchase a property in a corporation and pay an ATED, the equivalent to a Mansion Tax, but if this is not enough to ‘put them off’ they are being ‘trussed up’ with the Non Dom Residency arrangements and now, they meet this new obstacle of the Overseas Entity Bill” says Abrahmsohn in his latest blog.
“Given that we need positive inflows of capital into this country, now more so than ever before in the post Brexit era, how many hurdles are we going to construct before the international investor gets tired of all this regulation and moves on to other parts of Europe who would welcome them with ‘open arms’?”