Tax Structure
The following is a summary of UK tax consequences which should apply to investors who are individuals in Room to Invest . It is a summary for guidance only and does not constitute an analysis of the tax consequences applicable to all types of investor. Tax rules change from time to time. If you are investing on the basis of tax relief you must consult a tax specialist.
In particular this summary is not intended to constitute legal or tax advice and prospective purchasers are strongly advised to consult their own professional advisors on the tax and legal consequences of investing in Room Rights before doing so.
UK resident investors should receive income from the investment gross and not subject to any withholding tax. Income should be taxed in the UK in accordance with an individual investor's income tax rate. If the investment is assigned or sold to a third party for a sum greater than originally invested that gain will be assessable to capital gains at a flat rate of 18% subject to any reliefs available.
Individuals have an overall annual exemption from capital gains tax for the first £10,100 of chargeable gains in the current tax year. Most trusts have an equivalent exemption of up to £5,050 in the current tax year. Generally, losses realised on the disposal of assets may be set against other gains made during the tax year or carried forward to be set against gains in future tax years.
If the Hotel is sold in circumstances that permit some of the sum realised to be returned to investors then that will be paid to the investors in the same manner as the regular income payments and will accordingly also be assessable at the investor's income tax rate to the extent it does not represent a return of capital invested.