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HMRC Tax To Deter Foreign Investment In UK

HMRC Tax To Deter Foreign Investment In UK

Estate Agents Warn That New
HMRC Tax Announcement

Will Put Off Willing Overseas Property Buyers

 

The announcement made by HMRC about altering the Government position on taxation of using foreign capital as collateral for borrowings could have a significant impact on the residential market in UK cities, especially London, according one estate agent.

Cluttons’ Head of Residential Development, Julian Briant, reckons that the new rules over the use of foreign capital in order to be able to obtain a loan in the UK will now result in a taxable remittance, making mortgages less attractive for investors hoping to use money held abroad as security.

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Flipping Property To Be Made More Difficult By Government

Flipping Property To Be Made More Difficult By Government

Flipping Property To Be Made More Difficult By Government
In A Bid To Boost Revenue

In the week when I have just purchased my first property to flip, the UK Government announced that they are planning to crack down on the profits made by property developers and property investors who flip property.

The Government want action due to the demand for housing greatly outstripping the supply to market and they want a slice of the revenue that they feel the country is missing out on. This could greatly affect my business plans, so I thought I would examine the issue in more detail:

Flipping property is considered by Government to be the process of changing your main residence before selling a property in order to avoid paying capital gains tax (CGT).

However, as many property people will tell you, “flipping” is buying a property at one price and reselling it again within a relatively short time frame (6 month rules apply) at a higher price, whether you have done any work to improve the property or not.

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Moving Abroad? – Things To Know Before You Go

Moving Abroad? – Things To Know Before You Go

British Citizens Warned To Plan For

The Unexpected When Moving Abroad!

The Foreign and Commonwealth Office (FCO) has issued a checklist for British citizens planning to purchase property, retiring or moving abroad.

Buying property overseas can transform the lives of many property investors, but buyers are warned to take independent advice before completing any overseas property purchases and moving abroad.

FCO staff last year helped a number of British expatriates with a variety of issues, with many people facing heavy fines, financial ruin or finding themselves on the wrong side of the law because they were not fully prepared.

These cases involved issues such as property disputes, bankruptcy caused by changes in personal circumstances, pension complications and unexpected health issues.

A recent FCO report also suggests that high hospitalisation and death rates occur in areas where large numbers of elderly British nationals reside, notably in Europe and South East Asia.

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Five Important Aspects to Consider before investing overseas or buying a foreign investment property

Property Investors Dream Of Owning Property Overseas

Property Investors Dream Of Owning Property Overseas

Many UK property investors often dream of purchasing a single property abroad or even investing overseas in a ready made property portfolio. Although it is true that a great deal of money can be made by investing within the right market, this sector is not always plain sailing and inexperienced property investors can often find themselves getting into difficulty.

For this reason, it is crucial that buyers maintain a high level of caution before deciding to take the plunge and part with money to invest in a property overseas.

Five important aspects for consideration by property investors.

1. Think About The Reasons for Wanting to Invest Overseas

It is vital that property investors think carefully about the motives which make you want to invest in foreign property.

  • Do you want to invest because you have witnessed the positive market trends?
  • Do you feel obliged to invest in a particular country?
  • Will it be cost effective to own a property overseas rather than renting one yourself?

Before investing you need to do some vast research to ensure that there is a genuine demand for rental properties in your desired location. Carry out detailed calculations before buying to ensure that you will be making a long term profit on your foreign property.

2. Consider Travel Costs When Visiting and Maintaining a Property Overseas

Air travel is becoming more expensive, due to the price of fuel and carbon offsetting, for this reason, you must consider this aspect when purchasing an investment property abroad.

You may be required to visit the property for maintenance purposes or you could even be summoned to attend a court case in the country of purchase.

Think carefully before investing overseas as travel costs can quickly mount up, devouring any profit.

3. Be Realistic and Don’t Get Carried Away By Investment Hype

We all have seen the glossy magazine adverts pushing overseas property investment, however you must remain realistic and do a great deal of research regarding the location and costs in the area in which you would like to invest in a property. Talk to local residents and business owners and before signing contracts seek legal advice to ensure that you fully understand any clauses.

4. Check Market Viability Before Purchasing a Foreign Property

Before closing the deal you must find out how simple renting a property in your desired location is. Are there many empty properties in the area?

This is currently a large problem within the Spanish and Italian markets. Talk to a number of property agents in order to understand the local market before buying.

5. Think About the Potential of the Property in Question

How much money making potential does the property genuinely have?

If you are in the market solely to make a profit, consider low maintenance properties to keep costs down. Do your own due diligence, market research and operating and maintenance calculations to ensure that the property is worth investment.

At the end of the day, it is vital that you use your common sense within this competitive market and do not purchase a property unless you are 100% convinced that it is the right thing for you to do in today’s tough economy.

If you are ready to invest you can always find many reasonably-priced overseas properties for sale by clicking here.

There Will Never Be A Better Time To Invest In Property

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