Property investors buy property with the intention of making a long-term return. Property investment does not carry the same favourable tax reliefs as property development, but there are still important tax considerations, most noticeably capital gains tax, income tax and inheritance tax with the latter becoming increasingly problematic as property prices continue to increase
Property developers acquire properties with the purpose of making a short-term profit and most property development activities will constitute trading. Provided certain conditions are met, a property developer may be afforded a number of generous tax reliefs, although developers may also be subject to higher rates of tax on profits if the activities are not structured properly.
Stamp Duty Land Tax (SDLT) (and its Welsh and Scottish equivalents) is often one of the most challenging taxes to navigate. With multiple categories and rates and what can seem like constantly changing guidance, it can be difficult to get your SDLT liability right if your purchase is a little out of the ordinary. Many solicitors will suggest that specialist tax help is sought if there is anything unusual about your transaction.
The purchase, ownership and sale of UK residential property by non-UK residents can result in complex UK tax considerations.
Things to consider include the amount of SDLT paid on purchase, ATED, the Non-Resident Landlords Scheme (NRLS), the capital gains tax payable on disposal of UK property and the IHT position on death.
Capital allowances are a form of tax relief against capital expenditure (including some of the costs of acquisition of commercial property). If you operate your business as a sole trader, partnership or company, are a commercial property investor, or are an overseas investor affected by the non-resident landlord scheme you could be eligible to claim capital allowances. Owners of holiday properties that qualify under the special tax rules for furnished holiday lettings can also claim.
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Our client was faced with a high VAT bill after HMRC challenged their VAT recovery on legal costs. ETC not only succeeded in defending our client’s position but did so in an innovative way, gathering and using facts and VAT case law to establish arguments as to why they could recover VAT costs thus defending their position and recovering the VAT costs.
Enterprise Tax Consultants provide valuable support to us regarding complex tax issues across a full remit of specialisms. The team are knowledgeable, approachable and commercial, finding us practical solutions to our clients’ problems. As a small accountancy practice this service enables us to offer advice and services usually only found in larger firms.
We’ve used different tax people in the past who have been OK, but since finding ETC our team couldn’t be happier; as we grow our practice we are so confident knowing ETC will be able to solve our clients’ problems – we know what we don’t know but we are confident that ETC will know.
ETC give us the whole spectrum of specialist tax advice enabling us to retain our clients and push the practice forwards.
Your overall tax position depends on the type of property, how it’s used (investment or development), how it’s owned (personally or through a company), and your residency status. Each factor can impact income tax, capital gains tax, SDLT, and inheritance tax.
Property investment involves long-term ownership for rental income or capital appreciation and may be subject to income tax and capital gains tax. Property development is usually seen as a trading activity, often with different tax treatments and reliefs, but also potentially higher tax if not structured correctly.
Yes. Non-residents face additional considerations such as the Non-Resident Landlords Scheme, non-resident capital gains tax, ATED, and possible IHT exposure. We help non-resident clients manage these issues and ensure compliance.
Stamp Duty Land Tax applies when purchasing property in England and Northern Ireland, with equivalents in Wales (LTT) and Scotland (LBTT). The rules can be complicated, especially with mixed-use properties or corporate purchases, which is why specialist advice is often recommended.
 If you own or operate commercial property, you may be able to claim capital allowances for certain parts of your expenditure. This can significantly reduce your taxable profit. We can assess your eligibility and help maximise your claim.
