Possible exit strategy by transferring beneficial interest

Possible exit strategy by transferring beneficial interest

by Readers Question

Guest Author

9:06 AM, 8th February 2017, About 7 years ago 18

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My husband and I own our BTL’s jointly. Say I wanted to retire to Cyprus or Malta permanently, could we transfer beneficial interest so we each owned half the properties individually, and then I sell my share largely free of CGT whilst living abroad for at least 6 or 7 years.

We are not splitting our relationship – we spend a lot of time on holiday anyway.

We are nearing retirement age and have been letting HMO’s for many years.

Many thanks

Jane Possible exit strategy by transferring beneficial interest


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Comments

Duncan McFadyen

11:18 AM, 10th February 2017, About 7 years ago

I'm a bit confused about the Malta residency requirements - Ordinary Residence etc. Is that just to enjoy extra tax benefits? an EU passport is the only thing required for physical residency and tax residency (after 183 days), isn't it?

Mark Alexander - Founder of Property118

11:25 AM, 10th February 2017, About 7 years ago

Reply to the comment left by "Duncan McFadyen" at "10/02/2017 - 11:18":

A Malta ID card is required to establish a Maltese Holding Company.

You can live in Malta without having one and still be non-resident for UK tax purposes, however, other benefits open up to you such as the healthcare system and other tax breaks once you are officially resident with a Maltese/Eu ID card.

Brexit may change whether you can simply choose to live here without a Maltese/EU ID card though. Only time will tell on that.
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Stuart

14:38 PM, 10th February 2017, About 7 years ago

Hi Mark

I was addressing your comment on you can spend as much time in any other country in the EU apart from UK if your a Malta resident.

My question centres around can you be a tax resident in Malta and spend less than 183 days there?

If the answer is yes, and lets say you spend 190 days in Spain wouldn't you trigger Spain's residency rule?

Can you satisfy two countries tax residency ruling and which country takes precedent as each country will want to claim you for tax purposes?

Mark Alexander - Founder of Property118

16:54 PM, 10th February 2017, About 7 years ago

Reply to the comment left by "Stuart " at "10/02/2017 - 14:38":

Hi Steve

Technically, yes, you have to spend at least 183 days a year in Malta to be considered resident here. However, who is doing the counting? When you travel between EU countries, with the exception of the UK, there is no border control scanning passports.

If you were to spend more than six months in Spain then yes, technically you would become resident for tax in Spain.

I don't know the answer to your third question.
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Robert

11:19 AM, 11th February 2017, About 7 years ago

I'm also planning to become non-resident to sell my properties, transferring a beneficial interest to my husband.
My problem is that I only just decided to do it recently and did not get my properties valued in April 2015. The gains were mainly pre-2015 (being in London) so it would pay me to have a back-dated valuation. Do you know any way of getting a valuation now, that HMRC would accept as valid or are they just going to revert to pro-rata?

Mark Alexander - Founder of Property118

11:31 AM, 11th February 2017, About 7 years ago

Reply to the comment left by "Fiona Stacey" at "11/02/2017 - 11:19":

Hi Fiona

Most RICS regulated valuers will be able to accept instructions to provide an April 2015 valuation and these are generally accepted by HMRC as satisfactory evidence.

HMRC do have rights to challenge surveyors on their valuations but this would be very unusual.
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Robert

13:33 PM, 12th February 2017, About 7 years ago

I also want to become non-resident to sell my properties and transfer a beneficial interest to my husband.
My problem is that I did not have the properties valued in April 2015 and wondered if you know a way of getting a back-dated valuation that HMRC will accept.
Most of my gains were prior to April 2015 so it would pay me.

Mark Alexander - Founder of Property118

22:04 PM, 12th February 2017, About 7 years ago

Reply to the comment left by "Fiona Stacey" at "12/02/2017 - 13:33":

Hi Fiona

You have already asked this question and I have already replied. Please see the comments above.
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