Investing in UK Property
Buying, investing in commercial or residential property in the UK
The global financial crisis of 2008 rattled the UK property market to its core. Investor confidence was shaken, and many are still hesitant to put their money into commercial real estate as a result.
But as the years have passed, a renewed sense of optimism has been steadily on the rise. The benefits of property investment are there for all to see; a lucrative medium to long-term opportunity is available to anyone who is serious about commercial property investment.
Now is a great time to invest in commercial or residential UK property – but as any accountant worth their salt would advise, you would be wise to take a cautious approach. While there is much to be gained, there is also much to be lost (as demonstrated by the 2008 market crash). There’s a lot you’ll have to consider, including property location, lease covenant strength, and market performance.
Above all of that, however, you’ll of course want to consider how much tax you’ll need to pay.
How it Works
Property tax
When investing in UK property, there are four different types of tax which will ultimately affect your bottom line:
Stamp duty:
Applicable to all residential properties bought in England and Northern Ireland, stamp duty is simply the tax levied on properties above a certain price (currently £125,000 for your main property or $40,000 for additional properties).
Capital gains:
The tax on the profit you make when selling a property that has increased in value.
Corporation tax:
By investing in or trading property as a limited company, you will be subject to corporation tax.
Income tax:
When you rent out a property, you’ll need to pay income tax on your profits.
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Help with investing in UK property
It’s no small feat to invest in UK property – particularly if you are looking to make a sizable, long-term investment in commercial property. But there’s no need for you to go it alone – with the right accountants on your side, you can proceed with the full confidence that your investments will be planned and conducted in the smartest manner possible.
Here at Gower, we have decades of experience in helping both UK and non-UK residents to make smart investments in UK property. Whether you are looking to invest in commercial, residential, or both, we can provide expert advice tailored to your unique circumstance, with a particular focus on the best approaches to tax.
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