Let’s be honest, anything involving HMRC, international agreements, and property probably makes you want to do something more exciting… like rearrange your spice cupboard. But stick with me, because the new HMRC property data exchange rules are not only a big deal, they could also catch you (or someone you know) off guard if you’re not prepared.
From as early as 2029, the UK government will start receiving detailed information from other countries about UK residents who own property abroad. That means if you have a villa in Spain, a pied-à-terre in Paris or an apartment in Portugal, HMRC will soon know about it. Automatically.
So what exactly is the HMRC property data exchange? And why does this matter for UK property owners?
This is the UK signing up to the OECD’s new global framework called the IPI MCAA (which sounds more like a new flavour of iced coffee than a tax transparency initiative, but here we are).
Essentially, it’s a big international agreement where 25 countries (so far) have agreed to share data with each other on who owns what property where. It’s designed to stop people from hiding money in offshore property. And it means HMRC property data exchange will become a powerful tool for tracking down undeclared income or capital gains from overseas property.
Important tip: The agreement currently includes France, Germany, Spain, and Brazil, while major jurisdictions like the US, Australia, and Switzerland have yet to sign up.
| Got property abroad? Want to know if you’ll be impacted? Get in touch; we can give you peace of mind. |
Why it’s happening now
Overseas property has long been a taxman’s blind spot. While HMRC already uses the UK Land Registry and the Register of Overseas Entities to track local property ownership, overseas property has been harder to pin down until now.
This initiative builds on other global transparency efforts like the Common Reporting Standard (for bank accounts) and the upcoming Crypto-Asset Reporting Framework (yes, your Bitcoin is next).
What could HMRC actually do with this information?
HMRC will use this data to cross-check whether you’ve declared:
- Rental income from overseas property
- Capital gains when selling property abroad
- The correct ownership structure (trusts, companies etc.)
If they find something that doesn’t quite match up, don’t expect a friendly email. You could be hit with penalties of up to 200%. The HMRC property data exchange means the window for ‘getting away with it’ is closing fast.
What should you do now?
Simple: get ahead of it.
If you own property abroad (or used to, or are thinking about it), now’s the time to check that everything is above board. We recommend that you:
- Review your declarations.
- Look at how the property is owned.
- Make sure you’re not unintentionally exposed.
Because if you don’t catch it, HMRC will!
And this isn’t just about tax returns, it’s about peace of mind. Better to fix any issues before that brown envelope lands on the doormat.
| Need expert advice? Contact us!We help many clients with overseas property tax planning, and we’re already working with people who want to get ahead of the HMRC property data exchange changes. Whether you need help understanding your reporting obligations, or want to review your entire tax position, we’ve got you covered.Email us at [email protected] to set up a friendly, no-pressure chat. |
