The above consultation outcome was published with the promise of a more detailed response in early Autumn 2014. In the meantime it has been announced that in recognition of the points raised in relation to the treatment of different types of diversely held entities, the Government intends to introduce a form of “close company” test to limit the scope of the extension of CGT to non-residents.

This should ensure that the extension of CGT will not apply where a disposal of UK property is made by diversely held institutional investor that holds UK residential property directly, or by one which invests indirectly through an arrangement that is not controlled by a few private investors. The government intends to draw on existing legislation to achieve this.