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propertylawyer
propertylawyer, Solicitor
Category: Law
Satisfied Customers: 280
Experience:  Property Solicitor with expertise in commercial and residential property transactions.
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I'm a British living in London and I would like to go into

Resolved Question:

I'm a British living in London and I would like to go into business with a Friend who is resident outside of the UK. The business we would like to get into is property. We would like to get a property in the UK together and then lease this out. What is the process to achieve this?
Submitted: 1 year ago.
Category: Law
Expert:  propertylawyer replied 1 year ago.

Hi

Thanks for your email.

Are you proposing to buy a commercial or residential property?

Where is your friend resident for tax purposes?

How are you proposing to finance the purchase, cash buyer or do you need a loan/mortgage?

Will you be using funds from abroad? If so, where?

If you can please provide some additional information I can assist.

Kind regards

Paul

Customer: replied 1 year ago.
Hi Paul,Thanks for getting back to me.My friend is Kenyan by nationality and lives in Kenya. All funds will come from him (from Kenya).The property will be a commercial property. We would like to set up a company as part of this business.For now, we are not sure if we can do a cash buy on the property or would need to take out a mortgage. Can you provide information on both of these options please?Regards
Ibrahim
Expert:  propertylawyer replied 1 year ago.

Hi Ibrahim

Thanks for responding.

It may be preferable to do this by setting up a UK registered company because your friend is overseas. It can depend on various factors and will require analysis beyond the scope of the advice available on this website.

You and your friend would then be directors of the company.

But you will need your speak to an accountant for advice on the most tax efficient method, as the taxation rules are different for companies and private individuals.

One issue which you will encounter and need to overcome is evidencing source of funds. Solicitors have to make investigations into funds coming in to the UK from abroad. Statements and potentially other documents will need to be provided together with a thorough explanation as to how the funds were accrued. Do be aware that you will have to deal with this requirement.

Firstly, take account / tax advice, which is best company/individually.

Secondly, speak to a mortgage advisor to decide if you will use mortgage finance.

Thirdly, once you know your finances you can find a property. You may have to pay stamp duty land tax on the purchase. You can check this on the Sdlt calculator on HMRC's website.

Fourthly, once offer is accepted appoint a solicitor. At this stage you will have to provide ID documents and documents to verify source of funds. If you are using mortgage finance, the mortgage off will be sent to your solicitor.

From this point the solicitor will handle the matter, carry out investigation, approve the contract, carry out searches. On exchange of contracts the deal becomes legally binding and you will pay a deposit to the seller. you will now be obligated to complete. On exchange you will agree a completion date. On that date you will pay the balance of purchase monies (you will receive the mortgage monies on the completion date), Sdlt if due. The property is then yours and the solicitor will register the transfer at the land registry.

Do let me know if you have any further questions or queries.

If my answer has been helpful please accept / rate to ensure I get paid for my time advising you.

Many thanks.

Kind regards

Paul

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