News and developments
The United Kingdom Economic Crime Act
A new Register of Overseas Entities will be created and held by Companies House. This new Act forms part of the UK government’s strategy to combat economic crime, while making sure that legitimate businesses continue to see the UK as a great place to invest.
What does this mean?
The new register will require overseas entities that purchased any UK land (which for the avoidance of doubt includes all residential, commercial, or agricultural property) on or after 1 January 1999 to declare its beneficial owners or managing officers. Overseas entities will not be able to buy, sell, transfer or lease land, or create a charge against the land in the UK unless they’ve registered with Companies House.
What is an overseas entity?
An overseas entity is any legal vehicle that is governed by the law of a country or territory outside of the UK (e.g. British Virgin Islands, Bahamas, Belize, Panama, Uruguay, United States of America, Japan, Cayman Islands, Guernsey, Jersey, etc). This includes IBCs, Private Foundations, LLPs, and other non-UK partnerships with a legal personality.
Do trusts need to be registered?
The Act does not include non-UK trusts as they would not have separate legal personality. However, it is important to remember that any non-UK resident trusts that acquire UK land / property after 6th October 2020 will have to register with the Trust Registration Service – this is regardless of whether they are liable or not to pay UK taxes. The deadline for this registration is 1st September 2022. Furthermore, if the trustee is a registrable beneficial owner then information about the trust would need to be provided.
What do you need to do?
You will need to provide basic details about the overseas entity and deliver one of the following three statements about its registrable beneficial owners and the required information for that statement:
- That the entity has identifiable beneficial owners and can provide information about those owners; or
- That the entity has no reasonable cause to believe that there are registrable beneficial owners and will provide information about the managing officer of the entity. This only applies if you do not believe that there are registrable beneficial owners. If they meet the requirements of being a registrable beneficial owner, then their details must be provided; or
- That the entity either has a beneficial owner that it cannot identify or is unable to provide the required information about a beneficial owner and will provide information about the managing office of the entity or as much information as has been obtained about the beneficial owners.