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What Are The Major Obstacles For US American Investors In The UK Property Market?

Several tax incentives formerly accessible to overseas buyers have been restricted by the UK government during the last decade or so. In this sense, owning a home in the United Kingdom may be less attractive than it formerly was in terms of tax planning. Having said that, there are several reasons why someone might want to purchase a house in London.

US buyers must pay a 2% stamp duty land tax premium on property acquired in England and Northern Ireland, as you point out. It’s important to note that this only applies if both persons (for example, a married couple) are non-UK residents. Furthermore, anyone purchasing a home as a second property, even if their primary residence is located outside of the UK, must pay a 3% fee (the surcharge is 4 percent in Scotland and Wales).

A UK taxpayer, for example, acquiring a home in England or Northern Ireland for £1.8 million (after September 30, 2021, when the current reduced rates are no longer available) would pay £129,750 in stamp duty, or £183,750 if it was a second property.

However, if you were a non-resident seeking to purchase a second home, you would pay £219,750. According to Forsters’ property attorney, Robert Barham, non-resident buyers, like UK taxpayers who are also higher or extra rate taxpayers, will be subject to UK capital gains tax when they sell their real estate investment at a flat rate of 28 percent of the rise in the property’s value over their ownership term.

Advocates representing non-resident purchasers of UK property used to spend a substantial amount of time and energy advising the client on the appropriate ownership structure to employ in order to reduce UK tax liability.

This is unusual at the moment since the benefits of using such arrangements have been largely negated by tax laws, and many structuring agreements eventually result in higher tax rates. For example, if you buy a family home in England through a non-UK company, stamp duty will be imposed at a set rate of 17%.

In most cases, there is no viable or tax-effective alternative to buying real estate in the names of the actual buyers.

One obvious disadvantage is that because the Land Registry’s data is open to the public, anybody can see who owns each property, including the price paid by the original owner.

However, whether or not buyers will lose money is almost entirely reliant on real estate market changes.

What Is the Most Effective UK Property Finder Software for US Buyers?

To acquire the greatest property values, you can choose from a variety of Proptech Software. DealSourcing is one of the most well-known. This proptech technology can help to automate the process by integrating many components into a single system that works as your own real estate agent. The system can locate investments all across the internet and sort them by ROI by using algorithms and automation.

You’ll save both time and money! The platform’s ability to find high-yielding assets is its major selling point. If you want to invest in UK real estate, DealSourcing.co is a no-brainer.

The system also calculates the ROI for each home listed on Rightmove, Zoopla, and Gumtree, as well as discovering low-cost properties for sale, saving investors hours of research.


Brought to you by DealSourcing.co.

DealSourcing.co gives you control of the influence of automation. With the click of a mouse, you can search over 200,000+ Below Market Value deals (Buy-To-Let, HMOs, and BRRR) with ROIs of over 15%. With our simple and easy-to-use tools, you can find high-yield properties quickly

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