The complexity of the property sector can be especially challenging for professional developers. We can help you with tax planning strategies to reduce your tax bills so that you can focus on what you do best.
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Here to see your property business succeed
As a property developer, you mainly buy land to build new properties or purchase properties to renovate and sell on for a substantial profit.
Property development, however, covers a wide range of activities, from major building companies to amateur property investors who buy the occasional run-down property to ‘do up’.
It is important to determine which type of property business you are from the start, especially as different tax rules apply to investors and developers.
HMRC regards property development as a trade, so any profits made from the sale of a property are subject to up to 62% income tax and national insurance rates rather than capital gains tax (as with property investment).
This also extends to the tax on a disposal of a property. As a property developer, the tax you pay could be up to two-times higher than the liability of a property investor.
That makes it extremely important to classify your business correctly from the start and ensure you are following the correct tax rules outlined by HMRC.
how can we help
If you need help to classify your business or would like some support when it comes to understanding the tax rules associated, get in touch with a member of our tax team by calling 01454 619900.
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