It has emerged that of the 97,000 properties in England and Wales held by firms registered abroad, almost half of these are located in London.
A vast amount of the UK’s foreign-owned properties can be found in the capital, amounting to £33.9bn, according to the figures analysed by the BBC using data from the Land Registry, with more than 6,000 of these properties situated in Kensington and Chelsea. The south-east has £7.2bn worth of residential and commercial properties owned by foreign-registered companies, followed by the West Midlands and the north-west which both possess £3.1bn of this wealth each.
The figures have made headlines due to the fact that a surprisingly high amount of these properties are owned by companies domiciled in the British Virgin Islands in the Caribbean, a British Overseas Territory, sparking concerns surrounding tax avoidance. The BVIs are the registered home of 23,000 UK properties, despite having a population of just 30,600.
There has been a government crackdown against using offshore companies to own residential property in order to avoid paying certain taxes, with more loopholes being closed, and Theresa May has also recently agreed to create an accessible register of all foreign-owned properties in the UK in order to increase transparency and reduce the amount of ill-gotten money being brought into the country.
Mark Giddens, of accountants and consultants UHY Hacker Young, said: “Until April 2017, if you weren’t resident in the UK and held a residential property via a company it was not counted as being an asset for UK-based inheritance tax purposes. So having a property through an offshore company meant you escaped inheritance tax.”
After the BVIs, the channel islands of Jersey and Guernsey own the next highest amounts of property in the UK, with around 21% and 12.5% respectively.