The UK government announced Wednesday that sovereign wealth funds will face corporation tax on directly held UK real estate for the first time, a move expected to raise about £690 million annually by 2029‑30. Previously, income and gains from such funds — including those of Norges Bank Investment Management, Qatar Investment Authority and Gulf state vehicles — were exempt from direct UK taxes. Chancellor John Healey said the change aligns Britain with other nations while keeping one of the world’s most generous regimes.
The policy arrives amid tension with the United Arab Emirates over potential sanctions on Manchester City, raising concerns that Abu Dhabi may curb future UK investment. Real‑estate advisers such as Andrew Teacher of Lauder Teacher Associates warned the measure could reinforce a perception that Britain is unwelcoming to foreign capital. The new statutory regime takes effect from 2029, with revenues forecast at £495 million in 2028‑29 before peaking at £690 million.
The Office for Budget Responsibility called the estimates “highly uncertain” due to limited data on affected assets. A technical consultation will precede legislation in the 2027‑28 Finance Bill.
Source: Financial Times Companies · Summarized by HeadlinesBriefing