The Appeal of Offshore Structures

For many global investors, offshore structures such as trusts, foundations, or overseas companies have long been used as vehicles for holding UK property. These entities offer a degree of separation from local probate processes and enable strategic estate planning, often across multiple jurisdictions. In particular, offshore structures can simplify succession by allowing shares in an offshore company to be passed between family members without navigating the legal complexities of UK inheritance laws.

The Evolving Legal Landscape

However, the regulatory environment has shifted significantly. UK residential property held through offshore companies is now fully within the scope of Inheritance Tax. Additionally, these structures may be subject to the Annual Tax on Enveloped Dwellings if the property is worth more than £500,000 and not rented out. Capital Gains Tax applies on disposal of these properties and, as of 2022, offshore entities must now register their beneficial owners publicly through the UK’s Register of Overseas Entities. These changes mean that the once-standard offshore approach now carries more visibility, cost, and complexity than in previous years.

When Offshore Still Makes Sense

Despite tighter rules, offshore structures still serve a purpose for certain families. For example, high-value portfolios involving multiple properties across jurisdictions, or investors based in countries with restrictive succession laws, may still benefit from well-designed offshore holding models. The key is not assuming offshore equals secrecy or tax savings – it must be aligned with clear goals, compliant frameworks, and professional oversight.

Adventum’s Perspective

We work closely with legal and tax experts across jurisdictions to ensure clients adopt structures that truly serve their goals. In some cases, a UK-domiciled trust or a special purpose vehicle may prove more efficient than an offshore company. We start with estate planning objectives, not tax shortcuts – before guiding clients toward structures that ensure control, compliance, and long-term peace of mind.