Overseas entities owning property in the UK must now register on a new register of overseas entities (ROE) maintained by Companies House and will need to keep that register up to date.
What is it?
Describing the rationale for the new legislation, the Government has stated that the new register “will require anonymous foreign owners of UK property to reveal their real identities to ensure criminals cannot hide behind secretive chains of shell companies, setting up a global standard for transparency.”
The measures being introduced will require overseas entities to provide information on their beneficial owners. For these purposes, an overseas entity includes companies, partnerships and any other similar entities that are governed by the law of a country outside the UK.
What impact could it have?
Due to many being unfamiliar with the rules, there could be a significant downturn in property transactions involving overseas investors and a drop in stamp duty land tax (SDLT).
The register went live on 1 August 2022, with entities owning UK property having six months to complete any necessary reporting – making 31 January 2023 an important deadline. Non-compliance can result in penalties, potential imprisonment and severe restrictions that impact entities’ ability to sell, mortgage or grant leases on property, something which could impact the currently booming property market.
Impacted parties have until 5 September 2022 to register, after this offshore entities will be unable to register UK property transactions if they are not compliant. Therefore, there is likely to be a flurry of market activity in the next few weeks to ensure all transactions are finalised before this deadline.
Get in touch
Those affected should immediately be prioritising the review of their existing overseas entity property structures to ensure the reporting obligations of the entity are met, if you need assistance in this matter get in touch with one of our team below.
Our experienced and approachable team are on-hand to assist you, please get in touch below: