This week, the British government introduced a proposal for a ‘Register of Overseas Entities’; the draft legislation was first drawn up in 2018 but, still subject to Royal Assent, it is not currently law.

At present, the proposed register may require shell companies to declare beneficial owners. If passed, these individuals will be obligated to register with Companies House.

It will apply retrospectively to property bought up to 20 years ago in England and Wales and since December 2014 in Scotland. Once registered, an overseas entity ID number will be provided and the entity will be required to update its information annually until it successfully applies to be removed from the live Register of Overseas Entities. Those that hold UK property through a Trust, at present, would also fall within the scope of the rules.

There is the possibility of sanctons and even penalties that might include, for example, restrictions on registering or disposing the title of the land

In the wake of this announcement, we would be more than happy to review the impact this draft legislation may have on your current ownership structure and advise on anything that may potentially become reportable. With your personal ownership objectives in mind, we may be able to also advise on alternative tax efficient holding structures. We will closely monitor the progress of the bill, potential alternations and when it could come into effect and keep you updated.

If you require any assistance in navigating this changing situation, please do not hesitate to seek the help of our Tax, Corporate and Legal experts.