Owners of property in the UK through foreign corporate entity will need to list
This past week, those who own property in the UK (or those who are looking to buy) through a foreign corporate entity will need to list under a new registry according to recent UK legislation.
David Prais, Partner and Head of Asserson’s Property Team, provides a brief Q&A on this topic.
What is the new legislation, and who does it affect?
New legislation has been introduced in the UK targeting foreign companies, including Israeli ones, that own or intend to purchase property in the UK.
The affected companies will be required to disclose the identities of beneficial owners on a new register at Companies House.The rules cover any land bought since 1999.
What are the implications for those who do not comply?
Failure to comply is a criminal offence, which could result in a prison sentence of up to five years and/or an unlimited financial fee.
There are other critical implications for the sceptics who are not worried about a fine or imprisonment; one will not be able to sell, buy or loan against their property without triggering a notice in the digital registry, resulting in the freezing of allaction on investments.
When does it come into effect?
The register has gone live this week, and as such, a company incorporated outside of the UK will have to place themselves on a Register of Overseas Entities before they can buy or sell land.
This bill is significant. It will have numerous implications on tax, residency, investment and corporate structures worldwide.
What should you do to protect yourself?
Israeli entities that have Real Estate interests in the UK should make plans without delay for advice on how to proceed and prepare themselves for the upcoming effects of the new legislation.
