Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
  1. Homepage
  2. Equities
  3. United Kingdom
  4. London Stock Exchange
  5. JTC PLC
  6. News
  7. Summary
    JTC   JE00BF4X3P53

JTC PLC

(JTC)
  Report
Delayed Quote. Delayed London Stock Exchange - 06/14 11:35:17 am
640 GBX   -1.23%
06/11JTCá : A View on the Art Market
PU
06/10JTCá : The British Virgin Islands updates its trust and probate legislation
PU
06/03JTCá : Owning Art – Don't Forget the Tax Rules
PU
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsOther languagesPress ReleasesOfficial PublicationsSector news

JTC : Avoiding Pitfalls When Buying Property Abroad

05/10/2021 | 07:52am EDT
Many people dream of owning a home abroad as a place of retreat and relaxation. However, before falling in love with your perfect villa or chalet, there are some practical things that you should bear in mind. We spoke to Charlotte Evans-Tipping, Senior Associate at Forsters LLP in London, to ask from a legal perspective what some of the key points are that people should think about before they buy. How does succession and inheritance differ for a property abroad?

Succession laws in England and Wales provide that on death, real estate assets will be automatically subject to the succession law of the country where they are located.

Unlike in England and Wales, where you are free to leave your estate to whomever you wish, most continental countries have forced heirship provisions that govern the inheritance of property. This means that a certain percentage of your estate must be left to defined heirs (usually your children and spouse). If you do not have an appropriate Will in place, these rules may apply to any foreign property you own on your death, which might not be what you wish.

Therefore, before buying a property abroad, you should make sure you have a Will in place that includes an election that any non-UK property will devolve under the terms of your Will (rather than the succession law of the country where the asset is situated). However, you should always take local legal advice first, both to confirm that the law of the country in question will recognise such an election, and to check that it does not cause any tax issues in that country.

Alternatively, depending upon the relevant tax and other legal advice and your wishes, the best option might be to put in place a local Will specifically to deal with your property in that country. The advantage of having a local Will, in addition to a UK Will dealing with the rest of your estate, is that it can make the probate process easier for your executors. However, care must be taken to ensure that the local Will does not accidentally revoke your main UK one.

What are the ownership options?

In the UK it is possible to own a property as joint tenants, which means that the property automatically passes to the survivor on death and not under the Will of the deceased (although it will still be subject to UK inheritance tax, unless the spousal exemption applies, where this is relevant). Some civil law countries have an alternative to joint tenancy (e.g. the 'en tontine' method of ownership) that can avoid forced heirship rules.

There might be circumstances where it is preferable to own a property through a corporate entity rather than personally, but the tax implications of doing so should be considered carefully.

If a foreign property is held by a trust, particular care must be taken because some civil law jurisdictions do not recognise trusts (and, therefore, forced heirship rules can still apply). Trusts may also be subject to onerous tax charges in some countries (usually because the trustees are treated as non-relatives and do not benefit from any reliefs or allowances that may apply for inheritance/estate/gift tax purposes).

Sometimes properties in civil law countries are owned through a structure known as a 'usufruct', where one person holds the title to the property, subject to the right of another person to use the property for life/a specified period, and to receive the income from it. Holding property through a usufruct may give rise to unwelcome UK tax consequences, so they should be treated with some caution, and UK tax advice should be taken.

Are there differences in matrimonial regimes?

Most continental countries have matrimonial regimes which determine how a couple's property will be treated on divorce, and/or dissolution of a civil partnership where this is recognised in the jurisdiction applicable, and which a couple may choose to enter into when they marry. For example, if a couple enter into a 'community of property regime' this will generally mean that all the couple's assets acquired post-marriage are jointly owned.

Often civil law countries treat UK nationals as having individual ownership of all property, so that community of property will not apply so again, it is important always to take local advice to understand whether and how a matrimonial regime may apply when a property is purchased in a country that has such a regime.

What tax implications should people consider during their lifetime when owning a property abroad?

Stamp duty land tax (SDLT): SDLT is not applicable to acquisitions of property outside England or Northern Ireland, but if you own a property abroad, you may have to pay a higher rate of SDLT (or an equivalent tax in Scotland or Wales) if you purchase an additional property in a country within the UK than would apply if you did not already own a property.

Capital gains tax: if you sell or otherwise dispose of a foreign property, you will still have to pay UK capital gains tax on any gain made from the sale (subject to certain deductions and reliefs). The position may also be different if you are subject to UK tax on the remittance basis, which will depend on your domicile status for UK tax purposes - detailed tax advice would be required in this situation. There may be local capital gains taxes that also apply on a sale or other disposal.

Income tax: if you rent out the property, UK income tax is likely to be payable on the rental income (subject to the basis on which you pay UK tax). Also, local income tax or income tax for non-residents may apply.

Tax regimes also alter over the course of time, and UK tax rules will depend upon your domicile status, so ensure your advice is kept up to date during the lifetime of ownership.

And what about after death?

Local taxes will apply on death, even if you have elected for English law to determine succession to your property.

If you are domiciled in the UK, following your death your worldwide estate will be subject to UK inheritance tax, unless the spousal or other exemption applies.

In many continental countries, it is the heirs and not the estate who will pay inheritance/estate/gift tax. Often, each category of relative will pay tax at a set rate, subject to an allowance. So if the entire estate is left to the surviving spouse, as is quite normal under an English Will, any allowance applicable to the children may be lost on the first death. Clearly, local advice would be needed to determine the position in the relevant country.

Where assets in your estate may be subject to tax in the UK and another country, there may be a tax treaty that will assist to prevent a tax charge arising in both countries. Even if no such treaty applies, the UK may give credit for tax charged by another jurisdiction in order to prevent double taxation.

What else should people consider?

It is crucial to take local legal advice and comply with all laws on buying and renting out property abroad.

You (or your lawyer) should check the title deeds to ensure that the seller owns the property you are purchasing or, if buying from a developer, check that the title deeds for the property exist and that the developer is entitled to sell the property.

You should also ensure that you understand whether annual property taxes will apply or any other fees (e.g. in relation to drainage or refuse).

Charlotte is a Senior Associate in Forsters LLP's Private Client team. She advises high net worth international individuals, families, trustees, beneficiaries, family offices and private banks on estate and succession planning, trust law and personal taxation.

To find out more please contact Charlotte on charlotte.evans-tipping@forsters.co.uk or Victoria Blackburn from JTC Private Office on victoria.blackburn@jtcgroup.com

This note reflects our opinion and views as of May 2021 and is a general summary of the legal position in England and Wales. It does not constitute legal advice.

Disclaimer

JTC plc published this content on 10 May 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 May 2021 11:51:08 UTC.


ę Publicnow 2021
All news about JTC PLC
06/11JTCá : A View on the Art Market
PU
06/10JTCá : The British Virgin Islands updates its trust and probate legislation
PU
06/03JTCá : Owning Art – Don't Forget the Tax Rules
PU
06/03JTCá : The Perfect Podcast for First-Time Fund Managers
PU
06/02JTCá : A Focus on Real Estate – Newsletter
PU
06/01JTCá : completes acquisition of INDOS financial
PU
05/28JTCá : Hot Property – Investing in US Real Estate
PU
05/26JTCá : Strengthens Americas Proposition with New York Director Hire
PU
05/25JTCá : To present at odpa's project bijou launch this week
PU
05/25JTCá : Mauritius Special Purpose Fund – A New Look
PU
More news
Financials
Sales 2021 148 M 209 M 209 M
Net income 2021 26,6 M 37,5 M 37,5 M
Net Debt 2021 75,4 M 106 M 106 M
P/E ratio 2021 27,3x
Yield 2021 1,20%
Capitalization 764 M 1 078 M 1 078 M
EV / Sales 2021 5,66x
EV / Sales 2022 4,81x
Nbr of Employees 861
Free-Float 87,8%
Chart JTC PLC
Duration : Period :
JTC PLC Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends JTC PLC
Short TermMid-TermLong Term
TrendsBearishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 9
Average target price 739,29 GBX
Last Close Price 640,00 GBX
Spread / Highest target 24,2%
Spread / Average Target 15,5%
Spread / Lowest Target 5,47%
EPS Revisions
Managers and Directors
NameTitle
Nigel Anthony Le Quesne Chief Executive Officer & Executive Director
Martin Fotheringham Chief Financial Officer & Executive Director
Michael Joseph Liston Non-Executive Chairman
Adam Jeffries Chief Information Officer
Michael P. Halloran Group Head-Technology Strategy
Sector and Competitors
1st jan.Capitalization (M$)
JTC PLC14.70%1 078
BLACKROCK, INC.21.52%134 324
BROOKFIELD ASSET MANAGEMENT INC.14.71%75 060
UBS GROUP AG16.92%57 127
BANK OF NEW YORK MELLON CORPORATION (THE)18.78%44 133
T. ROWE PRICE GROUP, INC.28.11%43 999