The Guide to Buying Your Dream London Home

Prime London 2015

Including details of our Property Finding Service 1 House hunting in London? Or simply curious to learn more about London property? Please contact us

Saffronart Prime London is a bespoke property finding and management service for individuals wishing to purchase property in London. Saffronart has partnered with Moving On, an experienced London firm, as well as a network of lawyers, mortgage experts, surveyors and property managers to assist you with the buying process and ongoing property management.

London Mumbai New Delhi New York +44 (0) 20 7409 7974 +91 (0) 22 4333 6200 +91 (0) 11 2436 9415 +1 212 627 5006 Abha Housego Shaheen Virani Sneha Sikand Anu Nanavati Chaddha [email protected] [email protected] [email protected] [email protected]

contents

5 Introduction 6 Saffronart Prime London 8 Prices and Trends 10 An Overview of London Residential Architecture 16 Mayfair & St. James 20 Marylebone 24 Kensington & Chelsea 28 Hyde Park & Bayswater 32 Belgravia & Knightsbridge 36 St. John’s Wood 40 Other Points of the Compass 42 Borrowing and Remittance Guidelines for Indian Buyers 45 Indian Tax Implications 48 The Legal Ins and Outs of London Property Hyde Park 52 Recent Tax Changes for Company-Owned Homes

2 3 Dear Reader,

Since the launch of the inaugural Prime London service and accompanying guide four years ago, we have been gratified by the response of existing and new Saffronart clients. Prime London has become the go-to resource for Indians wanting to buy property in Central London.

This latest edition of the guide, written from the Indian buyer’s perspective, has been brought up to date based on market changes as well as the evolution and implementation of recent property related laws in the UK. We have also updated the articles on remittance guidelines in © TfL from London Transport Museum collection India and the Indian tax implications of owning property overseas. The 2015 edition is published in PDF format to ensure wider distribution.

Prime London is a complete service to help Indians locate their dream home and manage it. As we represent the buyer and not the seller, we can not only locate the best property for you, but also negotiate favourable pricing and terms on your behalf. Our local presence in London on New Bond Street, along with our alliances with experienced London property professionals who have been operating in this market for decades, is aimed at easing you through the purchase

Publisher and ownership process. We work with a network of legal, mortgage and Saffronart Management Corporation Published April 2015 valuation professionals experienced in dealing with non-UK residents to

Design meet your purchase needs. Managing a property from far away following Alka Samant – Saffronart purchase can post its own challenges, and we offer a service tailored to ILLUSTRATIONS Aashish Dubey – Saffronart (p. 9-10) for this purpose.

Photography Ben Millar Cole We trust you will find both the guide, and the service of value. Stephanie Davidson Elisabetta Marabotto Please contact us at the numbers listed in this guide if we can help you

©Text in your London property search. Saffronart Management Corporation Beverly Lewis, Partner, Mishcon de Reya, London (p. 57-59) Yours truly, IMPORTANT NOTICE Jonathan Legg, Partner and Head, Any statements on the rules and process Abha Housego Nish Bhutani Real EstateTax, Mishon de Reya, of purchase of immovable property in the London (p. 60) United Kingdom contained herein is for Head-UK and Europe, Saffronart Chief Operating Officer, Saffronart general information only and purchasers Ashwyn Misra, Partner, Trilegal, of immovable property are requested Mumbai (p. 61-62) to independently consult their legal and Vishal Agarwal, BMR Advisors, professional advisors prior to entering into Mumbai (p. 63-65) any purchase transaction.

4 5 Prime london

Saffronart Prime London is a bespoke before they come to market or of ones that Due to the current scarcity of stock, it is not advise you on suitable renovators and property finding and management service are being discreetly marketed. Wherever unusual for there to only be a handful of decorators if needed, introduce to you to for clients wishing to purchase property possible, we preview potentially suitable properties to show. The process continues a trusted housekeeping service and on-call in London. Saffronart has leveraged its flats and houses, and dismiss the ones that until such time as we find a suitable maintenance services. experience in the Indian prime property are unsuitable. We then accompany you, property. market to expand into the UK, and partnered the buyer, on viewings on a tightly defined London is a magnet for the world’s wealth with Moving On, an experience London firm, schedule so as not to waste your time When we have identified a property, and there are more buyers than there are as well as a network of lawyers, mortgage whilst on a short visit to the UK. we can negotiate the best possible properties. Saffronart Prime London can experts, surveyors and property managers terms, advise on surveyors, lawyers and assist in finding you a good property at the to assist you with the buying process and financing, and monitor the transaction appropriate value. ongoing property management. through to completion. We can also

Moving on was established in 1987 with the To contact us for your property sole purpose of acting for buyers wishing needs, please call or email us: to purchase property in central London. It Oxford Circus, London (then and now) is a boutique business built on discretion Abha Housego, London and the ability to understand client [email protected] requirements. Whereas real estate agents +44 (0) 20 7409 7974 in the UK act for the seller of the property, Shaheen Virani, Mumbai Saffronart Prime London would act for [email protected] you, the buyer. Whenever possible we like +91 (0) 22 4333 6200 to meet would-be buyers face to face to establish their needs and requirements. Sneha Sikand, New Delhi [email protected] Having established the brief, we will +91 (0) 11 2436 9415 research the market and draw up a short Anu Nanavati Chaddha, New York list of potentially suitable properties. The [email protected] properties sourced are via real estate +1 212 627 5006 agents and a list of contacts built up over the past 25 years. Quite often Saffronart Prime London will be told of properties © TfL from London Transport Museum collection

6 7 Prices and Trends in Prime Markets Five-year forecast values* London Property

In this section, we look at how the London property market has performed over the last few years and the directions in which it’s heading. We also

walk you through the most desirable areas of dynamic central London Source: Savills Research and some of the best streets to buy on. Figure 2 *Assuming no mansion tax but allowing for revision of the council tax system NB: These forecasts apply to average prices in the second hand market. New build values may not move at the same rate

London is a wonderful city in which to live January 2013 reached average values that and work, and is seen as a safe haven in were 23.9% above their former 2007 peak. which to “park” money. After a decline in 2008, prices of prime residential property The prime Central London property It therefore makes good financial sense to Lack of supply and the ever increasing in Central London moved upwards, and in market continued to power ahead until buy in the current year before the prices number of both overseas and domestic the second half of 2014, when it slowed. continue their inexorable rise. buyers means that prices can only move Prices have remained broadly flat over the one way. The last five years have seen last six months as uncertainty surrounding Political unrest continues unabated in some spectacular gains, and it would seem one of the most unpredictable UK general certain areas of the world, and in many ways that we are set fair for the next five years. elections intensifies. the world is in even more turmoil than it was when we last updated this piece. London The UK benefits from few barriers to entry Activity has been stronger in lower price retains its status as a safe place to invest or exit of overseas buyers, and has a trusted brackets where there is a more pressing money, and the much admired democracy legal system. need to act, and the top three markets and the historical ties between our two by sales volume at the start of 2015 have nations make London a natural choice Bearing in mind Savills’ prediction of been Knightsbridge, Islington and St John’s for Indian buyers, whether as a long-term negative growth for the current year we Wood (Figure 1), though parts of the rental investment or a holiday home. strongly advise you to buy now. market are treading water as some buyers and sellers have postponed decisions until The current low interest rates mean that there is clarity around the outcome of the there are good fixed deals to be had when election. borrowing to fund a purchase.

According to Knight Frank, however, strong activity in some markets suggests there is a degree of pent-up demand that could be released after May. Savills predict a minimal price fall of 1.0% this year. Next year they forecast a price rise of 8.0% and a total increase between now and 2019 of 25.5% Figure 1 (Figure 2).

8 9 An Overview of London Residential Architecture

Mews? Maisonettes? Mansion Blocks? These are not the terms we are familiar with in India, where we are more likely to talk about colonial bungalows, builder flats, and FSIs. We clarify the terminology for you, so you can hit the ground running on your property hunt, armed with the language of a London local.

London with its long and rich history is usually the door was slightly raised from characterized by a variety of architectural the ground. styles, shapes and sizes of which few predate the Great Fire of 1666. However, the On the other hand the late Georgian style earliest surviving examples of architecture was characterized by an important cornice date to the 12th century. In central London, which covered the joint between the roof the main styles are Georgian, Victorian, and the wall. Moreover stucco was used to Edwardian and Modern. cover the lower layer of bricks. The houses included balconies which had decorative The majority of people in central London ironwork or were made of bricks covered live in flats. Some people prefer living in in stucco. Steps usually led to the main period flats for the charm and character door. It was during the Georgian period they hold, others prefer modern flats for that Lincoln’s Inn Fields, Covent Garden the convenience. and Leicester, Bloomsbury, Grosvenor, Berkeley, Kensington and Hanover squares, amongst many others, were laid out. Many An early Georgian Terrace and its distinctive features A Queen Anne-style Victorian house from the 1880s Georgian Style (1714-1837) late Georgian houses can be found in Mayfair. The Georgian style is characterized by simplicity, sophistication and matching and followed a standard plan, but combined painted window frames and stone work. house fronts. The early style featured plain Victorian Style (1837-1901) different styles and were quite eclectic. Red parapets, large dormer windows with flat brick and slate were the most commonly Thomas Cubitt, a great master builder pediment or segmental arched top. The The Victorian period was characterized by used materials. and supplier of building materials, was large white windows contrasted the red a dramatic increase in population which responsible for several large-scale projects brick which was the favourite building led to the expansion of towns and to the Other characteristic features of Victorian during this period, including building up material. Other typical features were a large building of new houses. Consequently houses were sash windows, prominent much of Belgravia, Knightsbridge and cornice, a flat top porch or pediment and buildings were produced in large numbers chimneys, Dutch and Flemish gables, white Pimlico.

10 11 large picture windows, basic brickwork and presents a low rise cityscape with the Edwardian Style (1901-1914) flat roofs. Although each area of London exception of a few tall buildings located boasts different architectural styles, St mainly in the City of London. Several Edwardian houses very closely resemble John’s Wood and Bayswater present a few different types of residential properties Victorian Houses with the exception of examples of modern architectural styles can be found in London which include the hallways which are much bigger in the along with period houses. London mostly following: latter period. Also some of the houses of this period have a more “cottagey” red- brick look. Plain sash windows are often relegated to the back, and casement windows or multi-paned sashes windows 1930s Art Deco Style were used for the front windows.

1960s Architecture

Modern Style (20th Century)

In the 1920s and 1930s low rise buildings started to develop in the art deco and modern styles.

These houses were typically small and mass produced. The houses were built using red brick, pebbledash, and half timbering with red clay tile roofs. Angled side or half round windows replaced the bay windows and the garage was an innovation of this period.

After World War II the authorities faced severe problems trying to accommodate the large numbers of people who had lost their homes as a result of bombing raids. This housing shortage was further exacerbated by the baby boom and the need to clear the slums. The housing crisis was eventually solved in the 1950s and 60s through the use of new low cost building techniques, materials and styles. The influence of European architects such as Le Corbusier (renowned in India for designing Chandigarh) is very evident in this period. Buildings were taller, linear and of higher Edwardian Style density. The exteriors were plain featuring

12 13 Mews Houses Terraced House

ØØFlat or Apartment: it can be found in ØØMansion Block: a building containing a block of flats, in a high-rise tower several flats. It can date from the block, or in a converted building. This Victorian period to contemporary times. Similar architectural styles in India: is a very common dwelling structure in A number of them come with a porter central London. Flats are usually spread and are built around communal gardens. In New Delhi, one can see similarities in Raj-era architectural over one floor (hence the term “flat”) styles transplanted to India in between 1911 and 1930 along the but sometimes they can extend onto ØØMews House: a conversion house from multiple floors. old stables, carriage houses or staff broad tree-lined avenues now known as the Lutyen’s Bungalow lodgings, but now considered highly Zone. Their elegant white classical stucco façades with Tuscan ØØConversions: usually refer to period desirable, frequently dating from the columns were at the time considered symbols of fine taste and houses which have been converted into 17th to 19th centuries. They are mostly European heritage. flats. located in central London. Earlier examples of European influence can be seen in the ØØDuplex: a flat extended on two floors ØØPenthouse: a large luxury flat usually which are connected through a staircase. located on the top floor of a building. grand homes and buildings of the old Imperial capital, Kolkata (formerly Calcutta), with its cacophony of neo-Classical, ØØDetached House: a house which stands ØØTerraced House: a row of three or more Victorian, and neo-Gothic façades. Mumbai (formerly Bombay), alone as a single-family dwelling and houses, which usually are two to five has one of the largest concentrations of Art Moderne (or Art often includes both a front and rear storeys high. Deco) buildings, easily recognized by their streamlined, linear garden and a garage. symmetry on Marine Drive. ØØStudio: it is a self-contained one room ØØMaisonette: a self-contained flat which flat which usually contains its own is part of a larger house or apartment bathroom and kitchen. block and is usually spread over two Note: Square footage quoted for a property in London is neither the at-times exaggerated “built-up areas” quoted in India, nor the “carpet area” which is defined as the usable floor space. Rather, square footage in London is generally calculated floors and features its own external as the wall-to-wall measurements taken from the inside of the outer walls of the house or flat. This means that square entrance. footage quoted does not include the thickness of the outer walls.

14 15 Mayfair &

Veeraswamy, the UK’s oldest Indian restaurant, was established in 1926 on Regent Street. The owner St James’s was the great-grandson of an Indian princess and an English general. Customers have included Charlie Chaplin, King Hussein of Jordan, Marlon Brando and 16 Indira Gandhi. 17 MAYFAIR & ST JAMES’S

Known worldwide as one of the preferred and legendary nightclubs such as Annabel’s haunts of the British aristocracy for much and Whisky Mist right on their doorstep. of the last three hundred years, Mayfair is named after the annual spring fair that took Yet despite being in the centre of activity place between 1686 and 1764 in Shepherd’s in central London, Mayfair is also home Market. Today the area is as iconic and to some of London’s most beautiful and sought-after as ever, and is one of the areas tranquil parks and squares, including St in central London in which visiting Indians James, Berkeley Square and Hanover feel most at home. Square, where visitors can forget that they are in the middle of one of the busiest cities Though many former residential buildings in the world. have been converted into banks, hotels and head-quarters for prestigious companies There are no inexpensive areas in Mayfair. since the early twentieth century, Mayfair It is just that some streets are even more still remains a social and cultural hub in expensive than others. Grosvenor Square central London. It is the seat of world famous and the streets south of it, including South hotels, such as Claridge’s, The Dorchester Audley Street, Mount Street and Charles and The Connaught, and contains a high Street (which leads to Berkeley Square) concentration of some of the finest shops, occupy the most sought after part of galleries, restaurants, theatres and bars in Mayfair. The prices of property in to the the world. north of Grosvenor Square are slightly lower due in part to their proximity to the Inhabitants of Mayfair with leisure time hustle and bustle of Oxford Street; a flat on on their hands are spoilt for choice, with Green Street (one block away from Oxford Savile Row, the Rolls Royce and Bentley Street) will cost less than a comparable flat showrooms, infamous department store on Mount Street. Properties to the south of Fortnum & Mason, a plethora of Michelin- Charles Street tend to cost less per square starred restaurants (including Le Gavroche foot than those in prime Mayfair. In general and Benares), London’s legendary theatre the prices in St James are lower than those district (known colloquially as ‘Theatreland’) in Mayfair.

During the Second World War, The Dorchester was considered one of the safest buildings in London, and became a refuge for the aristocracy. Despite wartime rationing, the menu during this time included oysters, smoked salmon and lobster (although by 1944 the sandwiches were being made out of soya paste).

18 19 Marylebone

The Langham Hotel on Langham Place Marylebone is named after has served afternoon tea since 1865, and the church of St Mary-a-le- proudly claims to be the place where the Bourne, built c.1400, located at tradition was born. what is now the northern end of Marylebone High Street.

20 21 MARYLEBONE

North from Mayfair is Marylebone, the agnès b, Designers’ Guild and Daunt The area that is now known as quietest district of the West End. Books; restaurants and bars nearby include Marylebone was once used as Sofra, Conran’s Orrery and perennial Indian Henry VIII as a hunting ground. Bounded by Regent’s Park to the north and favourite, La Porte des Indes, where a nine- Oxford Street to the south, Edgware Road metre waterfall cascades through the earthy to the west and Great Portland Street to the dining room, and guests are surrounded by east, Marylebone is generally less expensive rare tropical plants in the Jungle Bar. than neighbouring areas as much of it has been converted into offices. The period buildings overlooking Montagu and Bryanston Squares, particularly those Regarded for many years as dull and off facing west, have been the most favoured the beaten track, Marylebone became historically. Here one will find elegant fashionable at the end of the twentieth buildings with tall windows. However, century when a number of chic boutiques in recent times the streets close to the and cafés opened on the High Street. Since fashionable and quirky Marylebone High then, Marylebone has increasingly been Street have enjoyed renewed interest, and seen as a highly desirable place to live, prices have risen. As a rule of thumb, east especially by the younger set, who love the of Baker Street and west of Harley Street wide variety of more affordable red brick is where it’s happening. The buildings are mansion flats, mews cottages and luxury mainly red brick with a number of pre and apartment blocks. post war purpose built blocks. Basildon Court on Devonshire Street is just about as Harley Street is home to many prestigious close to the High Street as it is possible to medical and dental offices. Other points of get. Flats on Chiltern Street offer good value note in the area include Baker Street (haunt for money. Apartments in Faraday House of fictional detective Sherlock Holmes), on Blandford Street, some of which have Marylebone Village and Manchester Square. a balcony and/or parking space, are rather more expensive but have the advantage of Marylebone High Street is a vibrant area a porter. with a range of interesting shops, including

Regent’s Park

22 23 Kensington

The Orangery at Kensington Palace was originally designed for Queen Anne. It was used to store plants in the winter and hold ceremonies & Chelsea in summer. Today it is an elegant restaurant in beautiful surroundings.

Mahatma Gandhi lived in west Kensington for around one year when he was a law student at the Inner Temple (1888-1891).

24 25 backwater in and around Victoria Road, which is found KENSINGTON & CHELSEA opposite Kensington Gardens. Chelsea was originally a fishing village, To the west are the apartment until it attained popularity with royalty buildings of Kensington Court. in the late Middle Ages. It subsequently The Lycée Français is situated The Royal Borough of Kensington & tend to back on to gardens rather than on Cromwell Road, and for became popular with artists on account Chelsea encompasses Notting Hill, North overlook them at the front. Large family this reason South Kensington is of its good light. Kensington, Holland Park, Kensington, houses often have a flight of steps from the sometimes known as the French Earls Court, South Kensington and Chelsea pavement with a small garden at the back Quarter. Here most of the large and there are properties to suit every taste that has access to a communal garden that Victorian houses have been and budget. can comprise several acres. The residents divided into flats. Some have of properties backing on to gardens have been well converted, others Chelsea manages the rare feat of being access, but the gardens are not open to the have not. It is important to loved by all who live there. The youngsters public. The most favoured streets include know where and what you are regard it as hip, cool and happening, whilst Lansdowne Crescent, Lansdowne Road, buying. Queen’s Gate Terrace its older citizens (who may have resided Stanley Crescent and Kensington Park offers some good flats with there since its 1960s heyday) happily wile Gardens. Less expensive houses with access porters and lifts. Further up the away their leisure in the smart bistros of to communal gardens can be found on price scale are Onslow Square Elystan Street and Sloane Avenue, secure Elgin and Blenheim Crescents, Princedale and Onslow Gardens, which in the knowledge that 70% of this elegant Road, Penzance Place and Pottery Lane. have been fashionable for as district is a conservation area. long as anyone can remember. Until relatively recently the cut off point Adjacent to The Onslows is It is the wealthiest borough in England after was the underground station at Ladbroke Rose Square, a secure gated the City of Westminster and, excluding Grove, and nobody ventured further north. development with parking. the City of London, the smallest borough Nowadays, families with a lower budget There are also mews houses to in the capital. The area known locally as who want space will consider the large be found in this area. ‘Albertopolis’ (after Prince Albert, husband Victorian villas on Oxford Gardens, Bassett of Queen Victoria) is a centre of arts and Road and Chesterton Road. Prime Minister Between Kensington and the learning, and contains major museums David Cameron owns a large home in this Thames, we come to Chelsea. such as the Victoria and Albert Museum area, which he lived in prior to his move There are a number of purpose- and the Natural History Museum, important to Downing Street. Further on towards built blocks, most of which were universities such as Imperial College, Harrow Road is the St Quentin Estate in constructed in the late Victorian the Royal College of Art and the Royal North Kensington which is favoured by and inter-war periods. Cranmer College of Music, and the Royal Albert young professionals with aspirations of a Court and Whitelands House Hall. Highlights of the area also include house on Oxford Gardens. both offer good, solid flats and the unique and never knowingly undersold are close to King’s Road and all department store, Peter Jones, the annual South of Notting Hill is Kensington, and it has to offer. Further up the Notting Hill Carnival (Europe’s largest further south still is South Kensington. Here price scale, and with reception carnival), and several Embassies you will find anything from a basement rooms that face south and studio flat to a large detached villa. The overlook the Thames River, is Kensington & Chelsea comprises a large Academy Gardens development offers all Carlyle Court. Family houses area that stretches from Harrow Road that a wealthy international buyer could are also to be found in Chelsea, down to the Thames. Notting Hill is to the want. The houses on the Phillimore Estate but these tend to be less grand west of Bayswater. Here the best houses are sought after, as are those in the quiet than those in Kensington. Sloane Square

26 27 The name ‘Knightsbridge’ comes from an old legend, which pertains that two knights once staged a duel on the bridge that spanned the now-underground River Westbourne. Belgravia & Knightsbridge

Harrods, the famous luxury shop, was first established by Charles Henry Harrod in 1824 in Southwark and moved to the well known location of Brompton Rd in 1853. In 1985 it was sold to the Fayed brothers who owned it until 2010 when it was sold to Qatar Holdings. The motto of the store, engraved on its pediment, is Omnia, omnibus, ubique (Everything, for everyone, everywhere) and this is at the heart of Harrods’ success.

28 29 BELGRAVIA & KNIGHTSBRIDGE

Belgravia & Knightsbridge, along with Nichols- as well as the flagship branches Mayfair, are where the some of the of many British and international fashion wealthiest people in London live. houses, including Jimmy Choo, Manolo Blahnik, Prada, Armani, Gucci and Versace. The district lies mostly to the south-west of If you prefer equally elegant shops on a Buckingham, and is approximately bounded smaller scale, head for Beauchamp Place by Knightsbridge (the street) to the north, and Walton Street. The area is also home to Grosvenor Place and Buckingham Palace exclusive hair and beauty salons, antiques Road to the east, Pimlico Road to the south, and antiquities dealers, and chic bars and and Sloane Street to the west. clubs.

Pimlico Road is renowned as London’s Eaton Square. Cadogan Square. Ennismore uppermost stylish design district. Some Gardens. Rutland Gate. Albert Hall of the most eminent names in the British Mansions. Wilton Crescent. Belgrave art and antiques world can be found here, Square. Lowndes Square. These are among including Joanna Wood, Jane Churchill, the best addresses in London. Some would Nicky Haslam, and David Linley. Whether argue that they have now been joined you’re looking for a statement piece, a by One Hyde Park, but old money still relic from a bygone era or a charming favours the old addresses. However, not all collectable, it offers a wealth of design properties in Belgravia and Knightsbridge masterpieces. are eye-wateringly expensive. Eresby House is a good block, built in the thirties This vibrant corner of London also has a in a quiet area of Knightsbridge. Flats on host of fine dining restaurants, delicious Kinnerton Street and Sloane Street are less delicatessens and indulgent chocolatiers. expensive, and in some instances more With an impressive nine Michelin stars, conveniently located, than those on some Belgravia is one of the capital’s most of the more exalted streets. Prices tend to tempting foodie destinations, including the ease a little to the south of Eaton Square. Michelin-starred Indian restaurant Amaya. Properties in the area to the west of Eaton terrace are more affordable that those in Knightsbridge is home to two extravagant other parts of Belgravia, as are those on department stores- Harrods and Harvey Bloomfield Terrace and Ranelagh Grove.

Eaton Terrace

30 31 St John’s Wood

St John’s Wood became the site of Lord’s Cricket Grounds in 1814, when founder Thomas Lord moved his cricket pitch to the well-known site. Lord hired a flock of sheep to keep the grass at the required length.

32 33 ST JOHN’S WOOD

St Mark’s Church, Primrose Hill Primrose Hill, located at the North from Marylebone and cross Regent’s on the Jubilee line and the High Street is North end of Regent’s Park, Park is one of London’s first villa suburbs, the just a few minutes’ walk from the station. rises 256 feet above sea level ever fashionable St John’s Wood. Elaborate Restaurants do veer towards the chains, for a stunning view of London. roofs and crenulated walls combine to but of the upmarket variety, including The hill is made of clay and ensure that it retains the “my home is my Carluccio’s, Chez Gerard and Sofra. originally was part of Henry castle” ethos which was so important to the Edwardians. Like Marylebone, it has a An apartment on Prince Albert Road with a VIII’s hunting ground. It wonderful High Street, though it is rather balcony and view of Regent’s Park is about became a public space in 1842. more family orientated. as good as it gets. Imperial Court, which Today it is a very popular park was built in the sixties, is the crème de la and fashionable neighborhood It is the location of Lord’s Cricket Ground, crème. The majority of the other blocks where many models, actors home of Middlesex County Cricket Club on Prince Albert Road, including Viceroy and artists reside. and the Marylebone Cricket Club, and the Court, Stockleigh Hall, Bentinck Close and original headquarters of the sport. Oslo Court were built in the inter-war years. The apartments in these blocks are less It is also famous for Abbey Road Studios, expensive and, compared with the more where The Beatles recorded the Abbey central areas of London, offer better value. Road album, the legendary cover of which Oslo Court is one of the few blocks of flats features the band crossing the road. Paul in London with its own restaurant. North McCartney has owned a property in the Gate at the western end of Prince Albert area since the 1960s along with many other Road was built around the turn of the last famous celebrities, including Kate Moss century, and is highly sought after. Houses and James Caan. on avenue road are often very large and sometimes described as ‘ambassadorial’. St John’s Wood High Street boasts a high Good family houses can be found on proportion of independent retailers. Parking Carlton Hill, Elm Tree Road, Marlborough is still permitted, though St John’s Wood is Place, Carlton Hill and Hamilton Terrace.

34 35 Hyde Park & Bayswater

Bayswater Road market is the largest open air art exhibition in the world. Every Sunday craftsmen and artists bring their works to sell at studio prices.

The Speaker’s Corner is another famous spot of Hyde Park. It became popular in 1872 after the police attempted to stop a political meeting and people rebelled against them. Since then, the Speaker’s Corner became the place where people can freely express themselves. Every Sunday, one witnesses 36 speakers proclaiming their views on politics, religion and other matters.37 HYDE PARK & BAYSWATER

Once deemed to be the poor cousin of the east, Bayswater Road to the south and its neighbours, the area of Hyde Park Lancaster Gate to the west. Much of it was Hyde Park is the largest and Bayswater has leapt in popularity in rebuilt in the 1950s, although some older stretch of open land in recent times. Architecturally, it is similar buildings have survived. The buildings to Kensington with plenty of white stucco overlooking the garden squares are the inner London, and was and grand porches around garden squares, most sought after, and Connaught Square created in 1536 when which contrast beautifully with streets of – on which Tony Blair has a house – is Henry VIII seized the land sweet cottages and chic mews homes. highly regarded. Flats in the stucco-fronted from Westminster Abbey buildings on the north side of Hyde Park to use it as a deer park. It Paddington Basin’s regeneration puts it on Square command a premium over the post was opened to the public par with Canary Wharf as a commercial war buildings on the east and west sides. district, with shops, offices and new homes Sussex Gardens was very run down for in the early seventeenth in striking tall buildings linked by walkways many years, but there are now signs of life, century by James I. and bridges. due in part to its proximity to Paddington and the Heathrow Express. Queensway provides the main shopping and restaurant quarter. It is dominated by To the west of the Hyde Park area lies the stylish and huge Whitley’s shopping Bayswater. Once again, it is the properties centre where many of the familiar high overlooking the garden squares that are street names can be found, together with the most desired. Craven Hill Gardens has good choice of restaurants and a multi- some beautifully restored buildings that screen cinema. have been converted into flats. Prices get higher as we move west, and Palace Court The Hyde Park area is bounded by Sussex has some of the best flats in the area. Gardens to the north, Edgware Road to

Hyde Park

38 39 OTHER POINTS OF THE COMPASS

London is a huge city and has as great a Shepherds Bush. The Westfield shopping diversity of areas and types of properties as centre has provided impetus for housing it does of people. and has helped to regenerate the area which is now favoured by young city professionals Camden and Islington on the north side looking to buy their first home. Transport were depressed for many years but their links to the city are good. proximity to central London and slightly Bohemian air has made them popular with media-types. Upper Street in Islington is as vibrant as it gets with a multitude of restaurants to suit every taste and budget.

The area known as Docklands on the east side has seen phenomenal growth since the early eighties. The docks were formerly part of the Port of London, at one time the world’s largest port. Over the past thirty years the population of Docklands has more than doubled and has become a major business centre. Residential properties in Docklands are significantly cheaper than in the other areas.

Further up the Thames past the Palace of Westminster and on the south side is the area known as Nine Elms, most famous for the now defunct Battersea Power Station. Nine Elms is currently being redeveloped. A new U.S. embassy is being built and, when it is complete, the staff will relocate from Grosvenor Square in Mayfair. The area is set to undergo a complete change of identity as regeneration takes place. Key to the project is the proposed addition of two Underground stations.

To the west of Kensington & Chelsea lies

40 41 Permanent Account Number (PAN) are desirous of purchasing immovable issued by the Income Tax authorities in property in London, the price of which is Borrowing and India; USD 2,000,000. A and B are both married with two minor children each. A and B and Remittance Guidelines for ØØGiven that the remittance facility under their family members can collectively remit the Scheme applies to individuals, the purchase price in two tranches i.e., remittances can be aggregated amongst USD 1,000,000 before 31 March and the Indian Buyers family members, subject to each family balance USD 1,000,000 after 31 March. member complying with the terms and Ashwyn Misra conditions of the Scheme; Given that the Scheme permits remittances Partner, Trilegal, Mumbai, India | March 2015 for a variety of transactions (including ØØBanks are not permitted to extend purchase of immovable property) and the Many people have considered buying property overseas but shelved any kind of credit facilities to resident procedure for remitting funds overseas individuals to facilitate remittances under the Scheme is not onerous, it is the idea at the thought of having to deal with the cumbersome rules under the Scheme; and gaining popularity amongst Indian resident and processes one usually associates with Indian bureaucracy. These individuals. may be more straightforward than you think. ØØResident individuals can open, maintain and hold foreign currency accounts with a bank outside India for making Borrowing for Purchase of Property remittances under the Scheme without Overseas Direct Purchase of Property Overseas Some of the key terms of the Scheme are prior approval of the RBI. The foreign set out below: currency accounts may be used The Foreign Exchange Management Under the Reserve Bank of India’s (RBI) for putting through all transactions (Borrowing or Lending in Foreign Exchange) ‘Liberalised Remittance Scheme of USD ØØResident individuals can remit up to USD connected with or arising from Regulations, 2000 of the RBI place a 125,000 for Resident Individuals’ (Scheme), 125,000 per financial year to acquire and remittances eligible under the Scheme. general restriction on persons resident in a resident Indian individual can remit up hold immovable property or shares (of India on borrowing foreign exchange. As to USD 125,000 per financial year (April to listed companies or otherwise) or debt There is no restriction on the frequency of such, an Indian national residing in India March) for any permitted current or capital instruments or any other asset outside remittance. However, the total amount of cannot borrow foreign exchange from an account transaction or a combination India, without the RBI’s prior approval; foreign exchange remitted during a financial overseas lender for acquiring immovable of both, which includes acquisition of year should be within the limit of USD property outside India. immovable property or shares of a company ØØResident individuals (including minors) 125,000. As stated above, remittances can in a country outside India (except Bhutan, can avail the benefit of the Scheme, be aggregated amongst family members. However, a resident individual may utilize Nepal, Mauritius and Pakistan). provided that the individual has a Accordingly, a resident Indian individual the Scheme for remitting up to USD desirous of purchasing immovable property 125,000 for acquiring shares of a company outside India, the price of which exceeds outside India (Overseas Co). The Overseas The RBI Governor in his bi-monthly monetary policy statement USD 125,000, can aggregate the amount Co can then borrow the necessary funds on 3 February 2015 stated that the maximum remittance amount to be remitted amongst members of his/ from an overseas lender(s) to acquire the for resident individuals under the Scheme is being increased her family and the purchase price may be immovable property, and mortgage the from USD 125,000 per year to USD 250,000 per year. However, a remitted in tranches, such that, part of the property so acquired in favour of such purchase price be remitted in the current lender(s) to secure the borrowing. formal notification from the RBI is awaited to this effect, and financial year and the balance in the next the increased cap amount will be effective only after such formal financial year. A company incorporated in India having an notification. overseas office(s), may acquire immovable To illustrate - A and B are brothers and property outside India for its business and

42 43 for residential purposes of its staff, subject the prescribed format stating the amount to to compliance with any directions issued be remitted, the purpose of the remittance by the RBI in that regard. As such, if an etc. The authorized dealer may require Indian Tax individual has a company in India which certain additional information from the has an overseas office, then the immovable individual to confirm to its satisfaction that Implications property may be purchased in the name of the transaction, for which the remittance is the overseas office. It would be relevant to sought, is not designed to contravene any Vishal Agarwal note that the facility under the Scheme is provision of FEMA or any rule, regulation, BMR Advisors, Mumbai, India not available to corporate entities. Hence, notification, direction or order issued there the Indian company will not be permitted under. to remit funds under the Scheme to its Buying property overseas? It helps to understand the Indian tax overseas office for purchasing the property. Based on instructions provided by the implications in advance. We asked Vishal Agarwal of tax advisory individual, the authorized dealer may debit firm BMR Advisors to take us through the details. A resident individual may consider acquiring the individual’s account with the amount the immovable property jointly with his/her sought to be remitted, and remit the relative overseas (Overseas Relative). Under amount directly to the beneficiary or issue a this mode, the resident individual may remit demand draft in the name of the individual up to USD 125,000 under the Scheme and or the beneficiary. the balance purchase price may be paid by the Overseas Relative either directly or If the amount remitted is not utilized for PART 1: The Private Individual acquired by the individual, whether in India through funds borrowed by the Overseas the purpose stated in the declaration, then or overseas, would be liable to tax at the Relative from an overseas lender(s). the resident individual may utilize it for any Income-tax provisions higher of the amounts calculated in the other eligible purpose. An overseas residential property owned by manner described below: a resident individual could potentially result (i) the sum for which the property might Remittance Process in two streams of income (i) rental income, if the property is let out, and (ii) capital reasonably be expected to be let from Remittances can be effected only through gains, if the property is sold at a future year-to-year regardless of whether or an authorised dealer i.e., a bank in India date. On the basis that the individual owner not the property is actually let; or authorised to act as a dealer under the of the property is resident in India for tax Foreign Exchange Management Act, purposes, all such income would be liable (ii) the rent received or receivable (ignoring 1999 (FEMA). The individual will have to to tax in India. rent that cannot be realized), if the designate a branch of an authorized dealer property is actually let out. through which all the remittances under Taxation of rental income in India: the Scheme will be made. The individual Income tax is levied on the ‘annual value’ However, where the property is meant to be should have maintained the bank account of the residential property for any year. let out, but remained vacant for want of a through which the amount is sought to be Where the owner actually uses a residential tenant for the whole or part of the year, and remitted for at least one year prior to the property as his residence, the annual by virtue of this vacancy the rent received in remittance. value of one such property is taken to be point (ii) is less than the amount referred to nil. Proceeding on the premise that an in point (i) above, then the annual value will The individual may contact his banking individual who acquires residential property be taken as the amount actually received relationship manager for assistance on overseas already owns residential property or receivable during the year. the remittance. The individual will have in India which he / she occupies for personal to complete and submit to his authorized use and the exclusion from tax discussed From the annual value so determined, the dealer an application-cum-declaration in above is applied towards this property, owner is permitted tax deductions for (a) the annual value of any further properties municipal taxes paid to local authorities; (b)

44 45 30 percent of the annual value as a standard by applying index factors published by Conceptually, the Overseas Holding in India in the manner described in Part 1. deduction; and (c) interest payable on a the Indian Government. If the property Company’s income would be taxable in housing loan subject to a maximum of INR is held for 36 months or less, the gains India if it qualifies as a ‘resident’ in India. It If shares in the Overseas Holding Company 200,000 (approximately GBP 2,150) if the are treated as short-term capital gains could so qualify for a particular year if it’s are sold by the resident holder, any property is not meant to be let out, and (‘STCG’) and taxed at the rates applicable ‘place of effective management’ (‘POEM’), resulting capital gains would be liable to tax without any limit if the property is meant to to ordinary income. at any time in that year, is in India. POEM in India. Shares held for more than thirty- be let out. is defined to mean a place where the key six months are treated as long term capital • Where the gain is a LTCG, Indian tax laws management and commercial decisions assets. If held for thirty-six months or The net income determined in this manner provide for a relief from income tax if the that are necessary for the conduct of the less, they would be treated as short-term will be liable to tax under the head “Income proceeds from the sale are invested in company are made in substance. On the capital assets. Such gains would be liable from House Property” at ordinary income qualifying assets, subject to prescribed basis that the Overseas Holding Company to tax at the rates discussed earlier. Any tax rates applicable to the owner. At present conditions. is not effectively managed from India at loss resulting from the sale of shares of the the maximum rate of tax in India is 30 any time during the year, it ought not to be Overseas Holding Company can be offset percent plus applicable surcharge and cess. • If the sale of the property results in a regarded as being resident for Indian tax against taxable gains in the same manner If the computation results in a loss, such loss and such property has been held purposes. Rental income, if the property is as discussed earlier. loss can be used to offset income from any for more than thirty-six months, the loss let, would accrue to the Overseas Holding other source earned by the owner in that would be treated as a long-term capital Company. Such income should not be Reporting obligations year. Any unabsorbed loss can be carried loss (‘LTCL’). Such loss can only be offset liable to tax in India since it would accrue An individual who owns property outside forward and offset against similar house against any LTCG earned in that year to the Overseas Holding Company and India is required to report the details of property income for a period of eight years. from the sale of any asset and for a period not to the resident individual. Similarly, such property in his / her annual tax return. of eight consecutive tax years in a similar if the property is sold by the Overseas Tax implications on sale of the property: fashion, until the loss is exhausted. If the Holding Company, any capital gain realized Wealth tax1 Gains arising from sale of a residential property had been held for a period of from the sale would also accrue to the The levy of wealth tax is proposed to be property located in London would be thirty-six months or less, any loss from Overseas Holding Company and should abolished in India with effect from April taxable as “Capital Gains”. The taxable the sale of such property would be a consequently not be liable to tax in India. 1, 2015. However it is also proposed that gain is computed by deducting from the short-term capital loss (‘STCL’) and such Income distributed by the Overseas Holding reporting obligations under the income sale consideration, the cost of acquisition loss can be offset against any capital Company as dividends will be taxable as tax return be enhanced to capture details (including costs directly linked with loss, STCL or LTCL in that year from the ordinary income in India. If the owner which were otherwise furnished in the purchase of the asset), the cost of any sale of any asset and for a period of eight of the Overseas Holding Company is an wealth tax return. improvements and any expenses incurred consecutive tax years. Indian company, such dividend is taxable in connection with the sale. at 15 percent (plus applicable surcharge Direct Taxes Code (‘DTC’) The Non-personal Entity. and cess); if the owner is an individual, tax DTC was released in draft format under the • The rate of tax that will apply to such The tax implications discussed in ‘Part 1: would apply at the ordinary rates applicable previous government and was expected gains is a function of the period for which The Private Individual’, apply equally for to the individual. to replace the existing Indian tax regime. the property has been held prior to its residential property owned by an Indian However, the implementation of the DTC sale. The property would be regarded as company for investment purposes and not In case the POEM of the Overseas Holding has now been shelved. a long-term capital asset if it has been in the course of its business. Company, at any time of the year, is in held for more than thirty-six months India, it will be considered as a ‘resident’ in prior to its sale. Gains from sale of such If a resident individual were to acquire India and its entire income shall be taxable assets are classified as a long term overseas property through an overseas capital gains (‘LTCG’) and subject to tax company (‘Overseas Holding Company’) at the rate of 20 percent (plus applicable established by the individual, the associated 1 For the period up to March 31, 2015, wealth tax is payable annually at the rate of 1 percent on net wealth in excess of INR 3,000,000 (approx GBP 32,250). Wealth is defined to inter alia include, all residential property owned by a tax payer, surcharge and cess). In computing the tax implications will be different from those other than one property which is regarded as being for personal use. However, where a residential property is let-out for a LTCG, the cost of acquisition is increased summarized in the previous post. minimum period of three hundred days in any year, such property will be exempt from wealth tax. For wealth tax purposes, the market value of the property as at March 31 of each year is to be considered.

46 47 contribution (a service charge) towards (see Jonathan Legg’s article, ‘Recent Tax The Legal Ins and Outs of communal expenditure such as the upkeep Changes for Company-Owned Homes’). of the common parts and structure of the building and the provision of any services Up to four individual owners can be named London Property such as a lift and a caretaker. as legal owners of the title although the An owner of a long lease of a flat is entitled legal owners may hold for additional by statute to acquire a new long lease owners and/or for themselves on trust. With recent changes in UK laws related to stamp duty and taxation, extending the existing term for a further Minors (those under 18) are not entitled 90 years upon payment of a premium to be legal owners of property but may be we look at the applicable laws and implications of recent changes for in accordance with the formula in the beneficial owners under a form of trust. Indian buyers statute. Additionally, by statute a group of tenants may have a right collectively to buy Planning and Development the freehold of the building so that they In the United Kingdom, property manage and run it. This is usually purchased development is subject to strict control. by a company nominated by them in which Rights enjoyed by neighbouring owners Property law in England and Wales will which it stands is included in the title. A be unfamiliar to those used to other leasehold title is granted by the owner each participating tenant would have a may also impact upon the ability to jurisdictions. This brief guide summarises of the land (usually the freeholder) for a share. develop or extend existing buildings. the types of property ownership available, specific period of time – usually a lease will Most development work including either the possible structures for ownership, a be granted for a term of 99 years but may In addition to a service charge, you may erecting or altering an existing building or summary of planning and listed building be as long as 999 years. Flats are always also have to pay an annual ground rent changing the use of the property may not be arrangements and a brief description of the leasehold. Houses in some of the most on a leasehold property. This is usually undertaken without planning permission. transaction and its costs and the UK taxes desirable parts of London (such as Mayfair, a relatively nominal sum but can be An application for the works required must which need to be considered. Belgravia, Chelsea and Regents Park ) may substantial on some of the larger London be made to the local planning authority. well be leasehold also as the freehold may estates. In each planning authority certain policies Types of Property – Freehold and still be in the ownership of the large estates will affect the ability to obtain consents Leasehold such as Grosvenor, Cadogan or the Crown. Ownership Structure for works. In addition, certain buildings Property in England and Wales is either You will need to decide the best way for of historic or architectural importance freehold or leasehold. You may find flats advertised “with a share your particular circumstances to own the may be “listed”. These are subject to of freehold”. This means that the tenants property. It can be purchased in your sole additional controls imposed by planning If the property is freehold, both the building collectively own the freehold of the building name, in joint names (for example with a legislation and permission is required for and the land on which it is built including the in which the flat is located and the flat spouse or other members of your family) any works (even very minor ones) whether soil below and air space above are included owner will have a vote in the management or by using a company or trust. Purchasers structural or not and whether external or in the title. Houses are usually freehold – of the building and the ability to extend his who are not UK residents and who intend to internal, which might alter the character (although in London, leasehold houses are lease at no additional cost. The lease is a purchase property as an investment have to of the building. In addition, some areas common). Freehold title lasts into infinity mechanism under English law to ensure date found it advantageous for tax reasons are designated conservation areas, being and is a form of outright ownership. enforcement of covenants between the flat to acquire residential property through an areas which display particular character. owners for maintenance and insurance of offshore company. However since recent Demolition of buildings and the cutting A leasehold title is equally valid, but the the building. You cannot own the freehold changes this may not be the preferred down of any trees in a conservation area freeholder will usually reserve the right to only of your own flat. route for some as in addition to the higher require specific consent even if they would be consulted on the way the tenant deals rate of Stamp Duty Land Tax (described not in other areas. with the property e.g. the use, alterations. The length of the lease of the property will later in this article) and an annual charge be reflected in the price. The lease will set for company-owned residential property In addition to obtaining planning permission If the property is leasehold, it means that out any restrictions affecting the use of and removing the exemption to Capital for building works, you may also need to only the property and not the land on the property and include a provision for Gains Tax which they have enjoyed to date ensure that any alterations comply with

48 49 building regulations. These regulations set solicitor will investigate), and its finance (by Buyers are required to pay Stamp Duty Immigration and Residency standards for design and construction of way of a mortgage offer if this is not a cash Land Tax on the price (and if a new lease, If you are not a citizen of the UK or an EEA buildings and address particularly safety purchase). Your solicitor will carry out due sometimes on the rental element if it is high National, you and any dependants travelling issues such as means of escape in case diligence searches at the local authority enough). Stamp Duty Land Tax is on a sliding with you will require entry clearance to of fire. Building regulation consent would and elsewhere in respect of planning, road scale depending on the purchase price. visit. Should you wish to acquire a more also be required to move bathrooms and and rail proposals etc and make enquiries Between 125,001 and £250,000 Stamp permanent status in the UK there are kitchens which would require new drainage of the seller’s solicitors. He will also ensure Duty is payable at 2%, over 250,001 at 5%, various categories under which you may in other areas of a building. that any of your specific requirements for over 925,001 at 10% and over 1,500,001 at qualify for residency, including: the property (for example if you wish to 12% in each case of the total purchase price. Transaction make alterations to the property or wish to In addition, since the Budget any property ØØinvestor- sole trader The transaction falls into two parts - before sub-let it) can be achieved. Once you are purchased by a non-personal entity such ØØretired person as a company, whether on-shore or off- ØØhighly skilled migrant and after exchange of contracts. In English satisfied and ready to proceed, contracts shore, will be required to pay Stamp Duty law, neither party is contractually bound to are exchanged and a 10% deposit is usually Land Tax of 15% of the purchase price This general summary is not intended to proceed with the sale and purchase until paid by the buyer as a sign of good faith, for properties over £500,000. (See chart be more than a guide and should not be contracts have been exchanged, even if the although this sum can be negotiated. At below) solely relied upon as each buyer should terms of the transaction have been agreed the time of exchange of contracts, a date take advice on his or her own particular between buyer and seller. Before exchange is agreed for completion which is the time Land Registry fees are also payable in circumstances. of contracts it is imperative that the buyer at which you pay over the balance of the accordance with a scale according to the satisfies himself as to the soundness of the purchase price and receive the keys of the price. building (by having a building survey carried property. out), the title to the property (which your

STAMP DUTY LAND TAX (PRIVATE INDIVIDUALS)

Purchase Price Rate

GBP 125,000 and below 0%

GBP 125,001 to 250,000 2%

GBP 250,001 to 925,000 5%

GBP 925,001 to 1,500,000 10%

GBP 1,500,001 and above 12%

STAMP DUTY LAND TAX (CORPORATE BODIES*)

GBP 500,000 and above 15%

* Such as companies and collective investment schemes

50 51 in May. This would mean that an annual personal name. This will avoid the ATED Recent Tax Changes for charge may apply to expensive homes and, in most cases, will also avoid CGT on even where held by individuals or trusts a future sale. However, other tax issues (at the moment, the ATED only applies will need to be considered carefully. Company-Owned Homes to companies). This route may give rise to a significant inheritance tax charge in the future, although there may be ways of managing Jonathan Legg ØØCapital Gains Tax (CGT): this risk. There can also be significant tax Partner, Head of Real Estate Tax If a company sells a property which is caught by the ATED, it will have to pay a charges on the dismantling itself which new capital gains tax charge at 28% on need to be considered. Jonathan Legg of Mischon de Reya explains the implications of recent all gains. For properties held on or prior (b) Nominee company UK budget changes for company-owned properties. to April 2013, it is only gains arising after this date which are caught by this CGT For individuals who are concerned about charge confidentiality, the solution might be to own the property through a nominee Properties with a value in excess of £1 company. Again, this would avoid the Many international individuals have used applied to the part of the purchase million or £500,000 will be subject ATED and possibly also CGT on a future an offshore company to buy their home in price in excess of £1.5m for residential to CGT from April 2015 or April 2016 sale because the individual will be treated the United Kingdom. Important changes property, so the difference between this respectively, when the ATED starts to as owning the property personally for tax occurred in March 2014 in relation to UK and the penal 15% rate for acquisitions purposes. However, some of the other residential properties which are acquired by companies is now less acute. apply to these properties. However, it should also be noted that a wider tax problems associated with personal by companies which are worth over ownership and with dismantling will £500,000. ranging CGT charge for non-residents holding residential property is expected remain. ØØAnnual Tax on Enveloped Dwellings from 2015 onwards. The UK Government originally introduced (ATED): (c) Mortgaged properties anti-avoidance rules to discourage This is similar to a wealth tax and affects Certain reliefs for genuine businesses Individuals who wish to transfer property ownership of home in companies in Budget properties worth over £2 million. The out of a company into their personal apply in respect of the above. 2012. These new rules broadly apply to all ATED ranges from £15,400 to £143,750 name where there is a mortgage in place owner-occupied UK residential properties depending on the value of the property, will need specialist advice. worth over £500,000 held by companies, payable by the end of April every year. What are the solutions for existing structures? unless the property is rented out to an Note that for properties held in April What are the next steps? unconnected tenant or certain other reliefs 2013, the relevant valuation date is Individuals with valuable, owner-occupied The current solution for any individual apply. April 2012 and then on the value of the UK residential properties held through will depend on their own personal property every five years after that. an existing company structure will need circumstances. Unfortunately there is no bespoke tax advice on the best way forward. “one size fits all” solution to the problem. What is the impact of the changes? From 1st April 2015, ATED will be In many cases, international individuals will Some options are set out below, but payable at a rate of £7,000 on residential also need to consider the tax position in ØØ Stamp Duty Land Tax (SDLT): properties worth between £1,000,000 a thorough review of each individual’s their home country. A new 15% rate applies to the purchase and £2,000,000 and from 1st April 2016 circumstances will always be needed to of a £500,000 plus home by a company. ATED will be payable on properties value establish the best solution in every case. over £500,000 at a rate of £3,500 per The “normal” Stamp Duty Land Tax rates annum. a) Personal ownership of the property for purchases of homes by individuals One solution could involve taking a or trusts increased significantly in It is possible that a new mansion tax may property out of an existing structure December 2014. A new top rate of 12% be introduced if Labour win the election so that the individual owns it in their

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