The UK is an attractive option for investors and internationally mobile high net worth (HNW) individuals due to its political and economic stability, diverse investment opportunities, and beneficial tax regime. Below we explore these factors in more detail.
Economic and political stability
With economic and political uncertainty elsewhere, the relatively stable political environment in the UK and the international standing of UK markets mean many international investors continue to consider investing substantial capital in the UK.
Foreign investment
The UK places no restrictions on foreign investment, except for significant holdings in sensitive sectors. Its extensive network of double taxation agreements also provides protection against double taxation for inward investment by investors from most countries.
Beneficial tax rules
The UK tax regime offers significant benefits for non-UK residents investing in the UK and for those who are newly resident.
Non-UK residents generally pay no UK tax on UK dividends or bank interest, and gains, even on UK assets, are generally tax-free for non-UK residents, except for those (in broad terms) derived directly or indirectly from UK land.
For new residents, anyone who becomes UK resident for the first time (or after 10 (consecutive) tax years of non-residence) can claim relief from UK tax on foreign income and gains for up to four years and will have no UK inheritance tax exposure on foreign assets if they stay in the UK for up to nine years. This makes the UK highly attractive for internationally mobile wealthy individuals who are considering relocating for a temporary period, particularly those with a liquidity event in the pipeline.
Confidentiality
It remains possible, in most cases, to use trusts and nominees to maintain privacy in relation to the ownership of UK assets. Exceptions to this rule include controlling interests in UK companies and in overseas entities that own UK land, which would require specific advice.
Planning for UK investments or residency
Anyone considering moving to, or investing in, the UK should ensure they obtain appropriate advice at an early stage so they understand the legal and tax implications, as well as any associated risks.
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