In today’s changing and uncertain fiscal and political climate it has never been more important to carefully consider how to finance an overseas property investment.
Until very recently the holding of the property in an SPV had been the foremost priority to seek the most flexible and tax efficient structure for a non-resident owning overseas property. However, the benefits of holding property in an SPV have largely diminished as governments around Europe have sought to close the fiscal advantages that these entities held. As a consequence we have seen some clients incurring significant notary and legal fees taking ownership away from SPV’s.
Using bank finance and structuring it correctly to compliment an owners overall fiscal circumstances remains a legitimate and invaluable opportunity in the current climate which can provide a degree of control and certainty when constantly changing governments introduce new obligations and legislation for property owners.
Although many high net worth individuals have the capacity to acquire property with no recourse to debt this concentrated investment in a single asset in a foreign jurisdiction leaves the owner with no flexibility of this asset and expose to any future changing political and fiscal environment.
For higher value purchases bespoke financing solutions can be created to set the optimum level of debt on the property, thereby creating tax efficiency whilst preserving and avoiding the liquidating of other investment/ assets that might have otherwise been instigated to enable the purchase of the property.
These solutions are arranged with banks in banking centres currently situated in the most politically stable jurisdictions in Europe, so that purchasers can profit from the appreciation of the property and continue to manage their financial assets in the most tax efficient way.