This time last week, Kersten Muller and I were in sunny Jersey and Guernsey, presenting on the Government’s proposals to bring gains by non-resident investors on disposals of UK commercial property within the UK tax net from April 2019.

It was my first trip to both places and I was pleasantly surprised at the uniqueness of each Island’s character and landscape. While Guernsey’s hillside and windy country lanes offers some calming picturesque views and a good work out! Jersey’s flatter terrain and was equally appealing with the benefits of a lively town. The friendly rivalry between the two Islands was noticeable but both had something in common, an interest in the upcoming changes to the capital gains tax rules.

The proposals, announced at last November’s Budget, mark a significant change from current practice and with under a year to go, it's clear that there are many questions on the possible implications for the UK property market in addition to the impact on the Islands. Working in collaboration with Grant Thornton Jersey and Grant Thornton Guernsey, it was no surprise to see a large turnout from local fiduciary service companies and family offices to lawyers and other professionals looking for some clarity on how the rules intend to operate.

It was clear from the Q&A round up sessions that the impact on existing overseas property structures holding UK property is a key concern and how investors will structure acquisitions in the future remains a hot topic of conversation, especially for investors co-investing with institutional investors who are looking to preserve pension pots. With the introduction of the new rules coinciding with Brexit, these changes are bound to bring about a short period of unrest and while it may take time for the market to adjust, there is no doubt that the Islands still provide a valuable platform to do business with a well regulated financial sector and a wealth of expertise.

To learn more about these changes and their potential impact, contact Jessica Patel or Kersten Muller.