29 May 2014 by

A TAXing question: Commercial Property

As the economy improves, many investors are turning to Commercial Property as a safe (if not exciting) addition to their investment portfolio. Capital appreciation is not great in this market, but yields are respectable.

Tax is a consideration and whilst advice should always be sought from an accountant, the main issues are as follows:-

  • Capital allowances. A buyer may be able to obtain tax relief for a significant part of the purchase price through claiming these. 
  • Value added tax. The purchase of property is, generally, an exempt supply although there are a number of exceptions.
    Importantly, if a seller has made a VAT election, VAT will normally be payable upon the purchase price.
  • Stamp duty land tax. Stamp duty land tax  applies to the transfer of any estate, interest, right or power in, or over, land and is payable by the buyer or transferee. The rates differ based upon the price paid (including VAT if this is in fact payable) and tax is also, in certain instances, payable on the rent paid under a lease, even if no premium is paid. 
  • Treatment of loan interest. A property owner should be able to obtain tax relief for interest on loans made to buy a property. 
  • Chargeable gains. On a subsequent disposal of the property, tax is usually payable on any profit. This will normally be taxed as a chargeable gain, but could be taxed as income depending on the circumstances. 

If you require advice on buying or investing in Commercial Property contact us on 0207 288 4700 or email us at info@boltburdon.co.uk

9 May 2014 by

To sell or not to sell; that is the (taxing) question

Non-resident property owners to become liable for UK capital gains tax from April 2015 At present, and ignoring certain anti-avoidance […]

22 May 2014 by

Trade Marks: What happens when everyone refers to a moving staircase as an Escalator?

The European Court of Justice (ECJ) has recently ruled on questions relating to the loss of a trade mark where […]

Signup To Our Weekly e-News

"*" indicates required fields

We’ll never share your details with any third party in line with our privacy policy.