Osborne set to give non-UK fund groups CGT exemption

The Treasury is set to offer a carve out in the Capital Gains Tax regime which will mean non-UK asset managers will be exempt from paying CGT on UK residential properties held within funds.

Chancellor George Osborne’s 2013 Autumn Statement announced that non-UK investors buying UK properties would have to pay CGT for the first time from 2015.

However, the Chancellor is set to confirm today that this will not mean the end for tax breaks on properties held within fund portfolios.

The move will bring it in line with rules relating to UK fund managers which also have an exemption on capital gains tax for properties held within their own portfolios.

HM Revenue & Customs has confirmed the new non-resident CGT will be realised only on profit made on divestment.

It adds gains made before April 2015 will be ring-fenced, either by re-basing values to the implementation date or by a time-apportionment for the whole gain.