Contents
About James Bailey
About This Guide
1.1 Homeowners
1.2 Buy to Let
1.3 Buy to Sell
2 A Word about Limited Companies
3 What This Guide is Not About
4 Staying on the Right Side of the Prison Wall
4.1 Tax Planning and the Duke’s Gardener
4.2 Anti-avoidance Legislation
4.3 The “Ramsay” Doctrine
4.4 The Disclosure Rules
4.5 Tax Evasion – The Other Side of the Prison Wall!
5 Key Tax Dates for Your Diary
6 Anti-avoidance legislation – Section 776 ICTA 1988
7 Trading in Property
7.1 How to Avoid the £100 Trading Fine
7.2 National Insurance (NI) Contributions
7.3 Income Tax and NIC for the Property Developer
7.4 Property Development and Limited Companies
7.5 Accounts and Records
7.6 The Construction Industry Scheme (“CIS”)
7.7 Why bother with the CIS?
7.8 VAT
7.9 Property Developers and Trading Stock
7.10 Property Not Acquired as Trading Stock
7.11 Taking Out Property Trading Stock for Your Own Use
7.12 Expenses for Property Developers
7.13 “Wholly and Exclusively”
7.14 Allowable Expenses
7.15 Travelling Expenses
7.16 Cost of Car and Capital Allowances
7.17 Alternative Method for Car Mileage
7.18 Other Capital Allowances
7.19 Employed or Self Employed?
7.20 Grossing Up
7.21 Losses
7.22 Finance
7.23 Proprietor’s Capital Account
7.24 Loans for Mixed Purposes
7.25 Partnerships
8 Taxation for Homeowners
8.1 The Basic Exemption
8.2 “Only or Main Residence”
8.3 “Garden or Grounds”
8.4 Periods of Absence
8.5 “Job-Related Accommodation”
8.6 “The 36 Month Rule”
8.7 Nominating Your Main Residence
8.8 Relief for Letting
8.9 Income Tax Relief for Letting
8.10 Restrictions on Main Residence Relief
8.11 Withdrawal of Main Residence Relief
8.12 Pseudo Property Dealing
8.13 Enfranchisement of Leasehold Property
9 Property Development of Your Home
9.1 Selling the Garden
9.2 What is a “Main Residence”?
10 Buy to Let Development
10.1 Income from property
10.2 Capital v Revenue, and “Wholly and Exclusively”
10.3 Allowable Expenses
10.4 Bad Debts
10.5 Cash Basis
10.6 Loft and Cavity Wall Insulation
10.7 Rent Collection
10.8 Staff Costs
10.9 Repairs and Renewals
10.10 “Notional Repairs”
10.11 Modern Materials
10.12 Repairing Newly – Acquired Property
10.13 Legal and Professional Fees
10.14 Furniture, etc.
10.15 Renewals Allowance
10.16 Wear and Tear Allowance
10.17 Renewals and Wear and Tear Allowance
10.18 Capital Allowances (CAs)
10.19 Flat Conversion Allowances
10.20 Losses
10.21 “Partnerships” and Letting Property
10.22 Travelling Expenses
11 Financing the Property & Developments
12 Furnished Holiday Accommodation
12.1 So, What is “Furnished Holiday Accommodation?”
12.2 Advantages of Furnished Holiday Accommodation (FHA)
12.3 Capital Allowances
12.4 Losses
12.5 Pension Contributions
12.6 Profit Split for Married Couple or Civil Partnership
12.7 Capital Gains Tax
12.7.1 Rollover relief
12.7.2 Gifts of Business Assets
12.7.3 Business Taper Relief
13 Commercial Property
13.1 Capital Allowances
13.2 Premiums for Leases
13.3 Taper Relief and Commercial Property
14 Taper Relief
14.1 What is a “Business Asset”
14.2 Buy to Let and Business Asset Taper relief
14.3 Taper Relief and Relief for Main Residence – a Nasty Trap
14.4 Gifts Between Spouses (and Civil Partners)
15 Stamp Duty Land Tax
15.1 “Chargeable Consideration”
15.2 Debts (Including Mortgages)
15.3 Transfer to a Company
15.4 Exchange of Property
15.5 “Linked Transactions”
16 Tax Investigations
17 Inheritance Tax for Property Developers
17.1 IHT – The Basics.
18 Bonus Report - How to Master a Tax Investigation
Appendix A – VAT Questions and Answers
General VAT Questions
Full-time Property Developers
VAT and Buy-to-Let
VAT - Investigations
APPENDIX B – List of Case Studies