Tax and Residential Property

Residential property is one of the largest asset classes in the UK. As residential property accountants, our role is to help you successfully navigate the residential property tax rules ensuring you pay the correct amount of tax and take advantage of any relief that you are eligible for.

Residential property tax rules

Unsurprisingly, over the years, residential property has attracted the attention of governments who have extended the scope of taxation to residential property transactions. Some of the rules that may affect you include:

• The reduction of income tax relief for interest against rental income for individuals who own buy-to-let properties
• The 3% Stamp Duty Land Tax surcharge on the purchase of additional residential properties
• ATED – the Annual Tax on Enveloped Dwellings – and then extending the reach of ATED to lower value properties
• The reduction of the deemed period of occupation for main residence relief for Capital Gains Tax purposes
• Capital Gains Tax payable on the disposal of residential property by non-residents
• High rates of Stamp Duty Land Tax on the purchase of residential property

For individuals with a single residential property owned personally, these provisions may have a limited impact. But for individuals with multiple residences in the UK and overseas, the rules can add a significant complexity to your residential property-owning arrangements and will require careful and considerate thought as to the best way to proceed in the future.

With our extensive experience in residential property accountancy, Ritchie Phillips can help you successfully manage the complexities of owning more than one home and help you reduce your exposure to the various forms of taxation now applying to residential property in the UK.

If you would like to discuss a residential property tax issue with one of our accountants, please get in touch.