Land owned by companies based in tax havens revealed

LAND including Riverside Retail Park, the Cockhedge Centre and the former site of Mr. Smith’s is owned by companies based in offshore tax havens it has been revealed.

Companies are often based offshore to gain from three tax loopholes, including no capital gains tax, no inheritance tax and no stamp duty.

The government allows property buyers to hide their identities on the official land registry, with more and more properties being listed as owned by anonymous offshore companies.

Since 1999, 94,670 offshore entities have been set up purely to hold UK property.

Purchasers pay fees of between £800 and £1000 to offshoring agencies to ensure that their names are not made public.

The Barley Mow and Babylon nightclub on Bridge Street are owned by Stonegate Pubs, who are based in the Cayman Islands, while Mr. Smith’s and Riverside Retail Park are owned by companies based in Guernsey.

The Cockhedge Centre, Birchwood Shopping Centre and the Sportsman’s Arms in Penketh are owned by companies based in Jersey.

Other land in Warrington is owned by companies based in Panama, Luxembourg, the British Virgin Islands, St. Kitts and Nevis, Ireland and the Isle of Man.

Manoj Patel, director of Hamlet Homes on Crosfield Street, said: “Three major tax loopholes are currently fuelling the secretive offshore property boom.

“Offshore entities, provided they are genuinely controlled and managed outside the UK, do not pay any tax on the proceeds of property speculation, unlike resident Britons.

“People living abroad and non-doms who say they are only living in Britain temporarily can legally avoid inheritance tax by buying a property in the name of an offshore entity.

“It is then considered to be a tax-free holding in a foreign company, not a British asset.

“Anyone, British or foreign, can legally avoid up to five per cent stamp duty being imposed on the next purchaser by holding their property in an offshore company – upon sale the company shares are transferred, not the property.

“The company has to be managed offshore, which also saves 0.5 per cent duty on UK share transfers.

“These artificial techniques were partly outlawed by George Osborne in this year’s budget, but only for UK property worth more than £2m.

Three of the sites were bought for over this amount.

Crestwood Corporate Trustees Limited paid £53m for the Cockhedge Centre in 2006, Warrington Riverside Pradera Limited paid £31m for Riverside Retail Park in 2012 and Birchwood Warrington Limited paid £50m for Birchwood Shopping Centre in 2007.

Mr Patel also stated that offshore property companies can be used by bankrupt persons and celebrities.

He added: “Aside from the obvious tax reasons for such transactions, this anonymity is extended to others.

“A transparent land register would be invaluable for UK law enforcement, regulatory and tax authorities.

“Bankrupt persons and those carrying out mortgage fraud are able to conduct their property transactions anonymously using an offshore company.

“The restrictions imposed following a bankruptcy can be circumvented by using an offshore company to borrow money and purchase UK property.

“Many rich and famous do not want their personal details listed in the land registry for security purposes so are able to use an offshore company to keep secret from the general public and press their UK property assets.”