The payment of interest on an offshore mortgage is a taxable remittance from 6 April 2008 onwards (see E6.324C)1.
Pre-march 2008 loans
Non-UK loans were widely used before 6 April 2008 in planning for individuals resident but not domiciled in the UK. This was firstly because the pre-6 April 2008 legislation did not treat as a remittance the payment of the interest on a loan secured outside the UK (typically on non-UK assets or funds) that was used to acquire UK property. Any repayment of the loan principle was regarded as a remittance, however. Secondly, the ownership of the UK property acquired with the loan secured outside the UK could be structured so that any taxable capital gain was on the remittance basis and the value of the property fell outside the UK inheritance tax charge.
Grandfathering of pre-march 2008 loans up to 5 April 2028
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Web page updated on 17 Mar 2025 17:38