With the government looking more and more towards property for a solution to the UK’s flailing economy - including the introduction of 5% stamp duties on property investments worth more than £1m – is it any wonder that property owners are putting their properties into offshore vehicles?

Helping them to escape the cost of 5% stamp duties and inheritance tax (charged at 40%), in Central London alone £100bn worth of property is believed to be stored in offshore vehicles.

In fact, according to a recent inventory of 18,700 deeds by the Land Registry, they have found that is trend is spreading to property locations such as Manchester, Leeds and Derby too:

• London’s Westminster – 10,233 property investments
• Kensington and Chelsea – 5,464 property investments

And such actions are proving quite expensive for the government…

Causing them to lose between £330-£500m in stamp duties as well as £1.3bn in inheritance tax every single year, this type of tax avoidance is creating a huge dent in the countries finances.

So what is to be done?

Well, it certainly will no longer be overlooked. Instead the government plan to address this issue at the next Budget on the 21st March where they hope to implement stricter legislation to prevent tax avoidance on property.

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