On 18 January, the Department for Business, Energy and Industrial Strategy (BEIS) announced that its much-anticipated (and self-proclaimed “world-first”) overseas beneficial ownership register will go live by early 2021.
On 12 May 2016, the then Prime Minister, David Cameron, hosted an international anti-corruption summit in London. The stated purpose of the summit was to bring together world leaders, business and civil society in order to agree a package of practical steps to:
- expose corruption so there is nowhere to hide;
- punish the perpetrators and support those affected by corruption; and
- drive out the culture of corruption wherever it exists.
Shortly after the summit, Downing Street announced that “foreign companies that own property in the UK will be forced to make public who really owns them… [and] will have to join a new public register of beneficial ownership information before they can do so. This will be the first register of its kind anywhere in the world.”
Following a consultation, BEIS published a call for evidence on the details of the proposals, and a response to that is expected shortly.
According to a Government press release, since 2004, £180 million worth of UK property has been investigated as the suspected criminal proceeds of corruption, and over 75% of the properties that are being investigated use “off-shore corporate secrecy”. To counter this, the register will force overseas companies that own or buy property in the UK to disclose details of their ultimate owners. The Government has committed to publishing a draft bill this summer and introducing it in Parliament by next summer. The register is expected to launch by early 2021.
Business Secretary Greg Clark said:
“We are committed to protecting the integrity and reputation of our property market to ensure the UK is seen as an attractive business environment – a key part of our Industrial Strategy. This world-first register will build on our reputation for corporate transparency as well as helping to create a hostile environment for economic crimes like money laundering.”
Although not strictly a tax measure, the announcement is within an area which has recently attracted a great deal of scrutiny from HMRC, and follows hot on the heels of the Government’s announcements at the Autumn 2017 Budget to tax gains realised by non-residents on the disposal of all UK real estate.