In case of a hard Brexit, many technical changes need to be made to UK tax rules that currently interrelate with EU law. A mapping exercise has been completed to summarise the tax-related impacts of a hard Brexit on non-listed real estate.
UK property investment businesses with a European Union parent face the loss of favourable tax regimes in the event of a hard Brexit, according to an Inrev (Investors in Non-Listed Real Estate Vehicles) illustration. As a result of a no-deal Brexit, exemptions from withholding tax granted by both the Parent-Subsidiary and the Interest and Royalties directives would be removed, with the possibility of double-tax treaties replacing them. The agency urged businesses to examine whether their existing group structure is subject to withholding taxes and said they might have to consider moving UK bases to a EU member state.