Can I Invest in Property in the UK From Overseas?

• You will need to have a UK bank account in order to make payments for the property.
• You may need a mortgage from a specialist lender, as most high-street lenders will not lend to foreign nationals.
• You will need to pay stamp duty on the purchase of the property. The stamp duty you pay will depend on the property’s value.
• You may need to obtain a visa or residency permit if you want to live in the UK.
• If you are considering investing in property in the UK from overseas, it is important to do your research and seek professional advice. There are a number of companies that specialise in helping foreign nationals invest in UK property. They can help you find the right property, obtain a mortgage, and manage your investment.

In the UK, those who profit from selling property are also subject to capital gains tax, which is only applied to the profit earned after selling your asset. 

The amount of tax you pay will depend on the level of profit earned, among other factors that will be addressed later. 

You’ll pay Capital Gains Tax if you’re a: 

• Non-UK resident. 
• Representative of a non-resident who has died. 
• Non-resident who is a partner in a partnership. 
• Non-resident trustee. 

Another UK tax overseas investors must consider is the UK inheritance tax on residential properties. 

In 2023, the basic threshold for inheritance tax in the UK is £325,000, with a tax rate of 40% only applied to properties worth over this amount.

For example, if the inherited property is £500,000, only £175,000 of the total cash amount will be taxed. 

There are some ways to mitigate inheritance tax, so be sure to speak to an expert financial advisor for more details. 

Here are some additional things to keep in mind if you are a British overseas citizen (BOC) looking to invest in property in the UK:

• BOCs are not subject to the same restrictions on property ownership as non-British nationals.
• BOCs do not need to obtain a visa or residency permit to live in the UK.
• BOCs may be eligible for a reduced stamp duty rate on purchasing a property.
• However, it is essential to note that BOCs are still subject to UK tax on any rental income that they receive from property in the UK.

If you are a BOC considering investing in property in the UK, it might be worth speaking to a financial advisor to get specific advice on your circumstances.