A bit scared of buying in the UK as a US citizen

My wife and I met in London many decades ago and we have always dreamed of owning a flat in London. I know they are very very expensive and also since we expect just to be in London 4-5 months a year it's not a great financial idea, but it's really something we have talked about for years and we'd like to finally do it. We typically go to London a few months a year and just get in on a tourist visa (i.e., no visa, just walk in).

Now that we might be buying a flat I am a bit worried about being a US citizen and not being able to see our future flat. Should I just assume for most purposes that if we go to the UK for less than 6 months a year there really should be any issue with us going year after year. Of course no one can predict the future with anything, covid or otherwise, but want to gauge this group on this concern.

Does one of you have British citizenship?

What is your status in life?  Working, retired, etc.?

Only US Citizenship. My wife could get her Canadian citizenship but not sure if that helps at all.

We are both retired.   

So just to clarify (and some additional questions) for ease of responses:

1) As US citizens are we "okay" to enter the UK for 6 months or less once a year without "worry" about entering or taxes (if we are not renting out our flat)?

2) Should we title the flat in our names or a trust?

3) The UK inheritance tax seems confusing. Assuming we have a £600k flat. Is there a way to avoid inheritance tax if my kids take hold of the property upon our death?

Sorry for the delay in responding.

1.  You'll never ever be completely guaranteed to enter the UK without a visa allowing you to live in the UK.  You will *always* need to be prepared to show that the "center of your life" is in the USA and that you are not attempting to live in the UK through a tourist visa.  Things you will want:
a.  Return flights booked and ensure you stick to the dates (without a valid reason for changing the dates) as this is tracked
b.  Proof of funds showing that you will not work while in the UK
c.  Proof of a home and life (usually a job) that you need to return to in the USA

You'll also want to ensure you have fantastic insurance that will cover you for a trip more than 30 days in length.  The NHS is only free for British residents and cannot be used by tourists.  An oustanding NHS bill of £500 will prevent any future trips. 

You'll also want to consider NOT driving while in the UK.  US residents can only drive on their US license for 12 months before being required to have a UK license.  You won't be able to get a UK license as you won't have a visa that allows you to live in the UK.  This will mean it will be impossible to have insurance (that will pay out) and that you'll be considered unlicensed if you have a UK address and not a UK license.

For the tax questions, you will want to take advice from a highly qualified dual UK/USA tax attorney.

Do you have the means to qualify for a "golden visa"?  It's a £2 million investment in the UK but you can literally do anything you want.  It's exactly what it says it is.  GOLDEN.

A random consideration is that stamp duty will be high on a £600k flat as it'll be a second home (I presume you own in the USA).  Stamp duty on a £600k property will be £50,000 if you own a home already.  £32,000 if this is your only home.

Council taxes will be payable as well annually.  I'm not in London, but for reference my council tax is just under £3,000 per year.  Rises 5% to 6% annually.

I heard that the "Golden Visa" has been scrapped with immediate effect. A casualty of the Russia-Ukraine conflict.

https://www.theguardian.com/news/2022/feb/20/golden-visa-lawyers-call-for-uk-to-rethink-blanket-ban

The home secretary, Priti Patel, announced the immediate closure of the scheme last week to stop “corrupt elites who threaten our national security and push dirty money around our cities”.

More than 12,000 golden visas have been granted since the scheme was launched in 2008, including more than 2,500 to Russians. The programme allowed people with at least £2m in investment funds and a UK bank account to apply for residency rights, along with their family. The speed with which applicants were allowed to get indefinite leave to remain was hastened by how much money they planned to invest in the UK: £2m took five years, while £10m shortened the wait to just two.

Sorry for the delay in responding.

1.  You'll never ever be completely guaranteed to enter the UK without a visa allowing you to live in the UK.  You will *always* need to be prepared to show that the "center of your life" is in the USA and that you are not attempting to live in the UK through a tourist visa.  Things you will want:
a.  Return flights booked and ensure you stick to the dates (without a valid reason for changing the dates) as this is tracked
b.  Proof of funds showing that you will not work while in the UK
c.  Proof of a home and life (usually a job) that you need to return to in the USA

You'll also want to ensure you have fantastic insurance that will cover you for a trip more than 30 days in length.  The NHS is only free for British residents and cannot be used by tourists.  An oustanding NHS bill of £500 will prevent any future trips. 

You'll also want to consider NOT driving while in the UK.  US residents can only drive on their US license for 12 months before being required to have a UK license.  You won't be able to get a UK license as you won't have a visa that allows you to live in the UK.  This will mean it will be impossible to have insurance (that will pay out) and that you'll be considered unlicensed if you have a UK address and not a UK license.

For the tax questions, you will want to take advice from a highly qualified dual UK/USA tax attorney.

Do you have the means to qualify for a "golden visa"?  It's a £2 million investment in the UK but you can literally do anything you want.  It's exactly what it says it is.  GOLDEN.

A random consideration is that stamp duty will be high on a £600k flat as it'll be a second home (I presume you own in the USA).  Stamp duty on a £600k property will be £50,000 if you own a home already.  £32,000 if this is your only home.

Council taxes will be payable as well annually.  I'm not in London, but for reference my council tax is just under £3,000 per year.  Rises 5% to 6% annually.

Thank you! This is very helpful.

Can anyone recommend a "highly qualified dual UK/USA tax attorney"? 

Unfortunately I wouldn't be able to do the golden ticket even if was available.

I would reach out to Tanager Wealth Management and see if they have someone in-house or someone they can recommend.  They *only* work with US citizens in the UK, helping us navigate through the very complex tax regulations associated with investing as a US citizen living in the UK. 

I have chosen to keep my taxes as streamlined and simple as possible.  Basically everything we own is 100% in my husband's name (UK citizen only).  I literally keep all my eggs in his basket....   

Assuming we have a £600k flat.

  £600 k is the deposit right?  How much were you planning on spending for the whole thing?   Here's what you can rent for £700 per month in London

  £600 k is the deposit right?  How much were you planning on spending for the whole thing?   Here's what you can rent for £700 per month in London

I had a schmooze earlier and £600k will get a decent 1 bed. I think London house prices have been heavily hit by everyone moving out to (literally) greener pastures. 

I had a schmooze earlier and £600k will get a decent 1 bed. I think London house prices have been heavily hit by everyone moving out to (literally) greener pastures. 

  I was exaggerating a bit for sure.  I think it matters what you define as "london". 

Ethics of holding property that sits vacant for over half the year aside, you can get a 2-bed with a garden in zone 3 for less than £600k.