Considerations for HK/SG Residents investing in UK Real Estate

·        
Dividends –

o  
From April 2016 the Dividend Tax Credit will be
replaced by a new tax-free Dividend Allowance.

o  
The Dividend Allowance means that you won’t have
to pay tax on the first £5,000 of your dividend income, no matter what
non-dividend income you have.

o  
You’ll pay tax on any dividends you receive over
£5,000 at the following rates:

§ 
7.5% on dividend income within the basic rate
band

§ 
32.5% on dividend income within the higher rate
band

§ 
38.1% on dividend income within the additional
rate band

§ 
Personal Allowance: £11,000

§ 
Basic Rate Limit: £32,000

§ 
Higher Rate Threshold: £43,000

§ 
Additional rate band:Over £150,000

o  
Note wording of the
treaty -2. However, such dividends may also be taxed in the Contracting
State of which the company paying the dividends is a resident and according to
the laws of that State, but if the recipient is the beneficial owner of the
dividends the tax so charged shall not exceed:

§ 
(a) 5 per cent of the gross amount of the
dividends if the beneficial owner is a company which controls, directly or
indirectly, at least 10 per cent of the voting power in the company paying the
dividends;

§ 
(b) 15 per cent of the gross amount of the
dividends in all other cases.


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