Property Investors and Developers

Investors vs Developers

For tax purposes, there's a fundamental distinction between individuals and businesses involved in property transactions, depending on whether they are:

• An investor; or
• A property trader – including developers and land dealers

Property investors

Property investors buy property with the intention of holding it for the long term, often generating rental income by letting it out.

The UK's tax position on property investment has changed significantly in recent years. These changes need to be factored into any investment model, and existing structures should be reviewed regularly to make sure they still work.

Andy has advised on the following in recent years:

• Advising on the merits (or otherwise) of restructuring property portfolios
• Advising non-UK residents on how to invest in UK residential property efficiently
• Advising on Stamp Duty Land Tax (SDLT) on property purchases
• Effectively passing the value of property investment assets to successors

Property Developers

Property development is treated as a trade for tax purposes. Provided certain conditions are met, developers can access a number of generous tax reliefs – but they may also face higher rates of tax on development profits if the business isn't structured properly from the outset.

For commercial reasons, developers commonly run each project through a separate special purpose vehicle (SPV). But there's a range of suitable structures available, and the right one depends on each developer's specific facts and circumstances.

Andy guides clients through their options, working alongside their other professional advisers to make sure their property development business is structured to suit their objectives.

Andy also provides lectures to accountants and lawyers on the tax aspects of UK land and property.