Property Tax Planning

Philip Spencer is a tax partner at BDO LLP.

Part A Property Investors 1 Acquisitions of a property through a non-UK resident company; 2 Property ownership through a non-UK resident trust; 3A Relief for finance costs incurred by individuals, trustees and non-UK resident investment companies; 3B Finance costs for UK property investment companies; 4 Repairs, renewals and improvements; 5 Stamp duty land tax; 6 Capital allowances on plant and machinery; 7 Capital allowances on specialised buildings; 8 Holding investment property through a company; 9 Premiums received; 10 Letting as a trade; 11 Capital gains planning: properties held at 31 March 1982; 12 Capital gains planning: the indexation allowance; 13 Capital gains planning: deferring a sale; 14 Capital gains planning: selling the company rather than the property and the further possibility of selling to a UK REIT; 15 Enterprise Investment Scheme deferral relief; 16 Planning for losses: capital losses and surplus management expenses; 17 Planning for losses: transfer of property to a dealing company; 18 VAT planning for property investors Part B property Dealers and Developers 19 Tax relief for reductions in property values; 20 Reclassification of trading stock as investment property; 21 Tax planning on the transfer of trading stock; 22 Tax relief for finance costs; 23 Acquiring a trading company with tax losses; 24 Selling shares in a property trading company and anti-avoidance provisions; 25 Construction Industry Scheme; 26 VAT points for property developers Part C Trading Premises 27 Premium relief on the acquisition of a short lease; 28 Tax relief for finance costs; 29 Capital allowances on plant and machinery; 30 Capital allowances on industrial buildings; 31 Capital allowances on qualifying hotels; 32 Capital allowances on agricultural buildings; 33 Capital allowances on enterprise zone buildings and renovations/conversions in assisted areas; 34 Capital gains planning: replacement of business asset ('roll-over') relief; 35 Capital gains tax planning - Entrepreneur's Relief for individuals and trusts; 36 Capital gains planning for companies - exemption for sales of substantial shareholdings; 37 Tax-free statutory compensation; 38 Construction Industry Scheme; 39 VAT and trading premises Part D Private Residences 40 Motive for acquisition of a residence; 41 Main residence election where more than one property is owned; 42 Land and buildings included with a residence - maximising the exemption; 43 Converting, reconstructing or refurbishing a main residence; 44 Main residence: taking advantage of the exemption for the last three years of ownership; 45 Temporary absences - preserving the exemption; 46 Taking advantage of the exemption on let property; 47 Main residences: periods before 31 March 1982; 48 Rent a room: income tax exemption on part letting of a main residence; 49 Expense deductions for business use of home