Property Tax Planning

Philip Spencer is a tax partner at BDO LLP

Part A Property Investors 1 Acquisition 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 and Seed EIS CGT Exemption 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 gains planning: replacement of business asset ('roll-over') relief 31 Capital gains tax planning: entrepreneur's relief for individuals and trusts 32 Capital gains planning for companies: exemption for sales of substantial shareholdings 33 Tax-free statutory compensation 34 Construction Industry Scheme 35 VAT and trading premises Part D Private Residences 36 Motive for acquisition of a residence 37 Main residence election where more than one property is owned 38 Land and buildings included with a residence - maximising the exemption 39 Converting, reconstructing or refurbishing a main residence 40 Main residence: taking advantage of the exemption for the last three years of ownership 41 Temporary absences: preserving the exemption 42 Taking advantage of the exemption on let property 43 Main residences: periods before 31 March 1982 44 Rent a room: income tax exemption on part letting of a main residence 45 Expense deductions for business use of home Appendices Appendix I Items of Expenditure on Buildings and Structures Qualifying and Non-Qualifying as Plant/Integral Features (CAA 2001, Part 2, Chapter 3) Appendix II Construction operations for the purposes of the Construction Industry Scheme