Tax on land development

[Mustang]

Called in to the Bank at lunchtime to deposit some money - my £250 incentive from HMRC!! They are having some presentations on Thursday evening regarding Buy-2-Lets. Details about the market, rates, products available, tax law etc etc. A lot of different information not just about the Bank and its mortgages.

The bit that shocked me was the mention of a new tax in the forthcoming tax bill. I am trying to find out more. From what I understand, as of 2009 Gordo is introducing a new tax that has to be paid up front whenever land is developed. This includes "new builds" and extensions and is based on (I believe) the end value of the property. I heard the rate was 20%. The basic impact being if you add a £50K extension to you house and it increases the value of your house by £80K you would be taxed £16K making the total cost of the extension £66k. Builders are getting very nervous apparently!

Can anyone confirm this as I am not an accountant...?! Does anyone know more details??!!

God help us when/if he becomes PM!!

PM me if you want details of the meeting and venue.

[milanbenes]

'From what I understand, as of 2009 Gordo is introducing a new tax that has to be paid up front whenever land is developed.',

this must be a wind-up normally Gordon makes such things retrospective for the last 6 years.

Anyway back to the subject, if this is true then it is beyond stupidity.

It means newby's won't be able to get in property development as they are less likely to have the extra funds sloshing around in their business plan.

Well well, makes the UK a more enticing place to live - not.

Still for the indigenous people this should be considered as only good news
because I reckon it will reduce new developments and therefore put more pressure on the existing stick.

Giving you lot chance to upsticks and get out before the crash.

Milan.

[oraclesmith]

...and then you pay capital gains tax on the profit !

Sounds like another desperate measure to avoid raising the basic rate of income tax which would be a political disaster for them because it would hit the 'ordinary taxpayer' - ie. New Labour voters.

[ASB]

I tihkn it only relates to land when PP is granted. Apparently everything that is stuffed in through section 106 agreements and CGT payable by the owner is not enough.

http://www.pinsentmasons.com/media/2...m#Planningtext

[lukemg]

Jesus, thought the tax had gone up to 146bn already, how tight do they think they can keep squeezing the only people who are paying tax. Wealthy few don't pay any, they all have trusts/off-shore etc.
Get these b@stards out soon as.

[John Galt]

PGS will apply to residential and non-residential land – though small developments will be carved out.
PGS will be paid by the developer under self assessment. It will be required to file a PGS return and request a development start notice from HMRC prior to commencing development. PGS will be payable within 60 days of the development start notice being issued.
Unpaid PGS will be recoverable from subsequent owners of the development.
The rate of PGS has not been published but we are told it will be 'modest'.

[Sockpuppet]

Well you all know the housing market is doomed.

I'll be putting in an offer on a house when I get the mortgage approved so the market is bound to crash.

You heard it here first kids.

[milanbenes]

anyway,

what does this matter to you lot, none of you are property developers

Milan.

[Sockpuppet]

No, we are the people that buy the properties which this cost will be added onto.

[milanbenes]

that's alright, more money will be printed and consequently larger mortgages available to compensate for this, The Party wins both ways, they get the extra revenue and they get to circulate more money

everyone's a winner

Milan.