Property Tax: How to Avoid Property Tax

How to Avoid Property Tax by Carl Bayley BSc ACA

PUBLICATION DATE: JUNE 2011
PAGES: 304
EDITION: 15th

Overview of How to Avoid Property Tax

This highly acclaimed guide is widely regarded as the definitive property tax bible by landlords, property developers and the media. How to Avoid Property Tax – now in its 15th edition – is packed to the gunnels with invaluable tax planning advice, practical strategies and general tax saving tips which cannot be found in any other publication.

Learn how you could be paying far less income and capital gains tax on all your property assets and investments.

The 2011 edition has just been published and is full of up-to-date unique tax saving ideas. It is highly recommended for:

• Buy-to-let investors and landlords.
• Anyone renovating or developing property.
• Anyone looking for a detailed guide to the 2011 Budget tax changes.
• Property investors wanting to pay much less capital gains tax.
 

• Anyone wanting to claim lots of income tax relief and deductions.
• Experienced and novice investors.
• Accountants, solicitors and IFAs.
• Those actively climbing the property ladder.
• Those with second homes or big portfolios of buy to let property.
• Anyone wanting tried and tested ways of legally paying less tax.
• Anyone using their home for business purposes.
• Anyone selling an inherited property.

What information is contained in How to Avoid Property Tax?

How to Avoid Property Tax is completely updated for the current tax year, written in plain English so its accessible to both the novice and the professional, and is supported with a large number of clear, concise examples throughout.

The guide explains:

• ll relevant tax changes from the 2011 Budget Report.
• How the new Capital Gains Tax rules will affect YOU!
• How you can rent out property and pay absolutely no capital gains tax.
• Ways to avoid capital gains tax even if a property is not your main residence.
• How to enjoy 17 years of tax-free capital growth.
• How you CAN escape capital gains tax by selling one property and buying another.
 

• How to make the most of your Principle Private Residence Exemption.
• How couples can save an extra £8,500 in income tax every year.
• How to claim motoring, home office, travel, research and hundreds of other expenses.
• The five major tax benefits of investing in furnished holiday lettings.
• How anyone renovating or developing property can save thousands in tax.
• How your children can help you slash your tax bill.
• Safe ways to emigrate and escape capital gains tax.
• The tax benefits and drawbacks of partnerships and limited liability partnerships.
• The enormous tax benefits enjoyed by commercial property investors.
• How re-mortgaging property can save you thousands in tax… plus the traps to avoid.
• How to receive an extra £4,250 pa in tax-free rental income.
• Stamp Duty planning.
• Inheritance tax planning.
• How to save hundreds or even thousands of pounds in professional adviser fees.
 

• How to maximise tax relief for your interest payments.
• How to use your spouse to save £1000s in capital gains tax.
• Why you should ‘let to buy’ instead of ‘buy to let’.
• How to get tax relief on interest when you buy a new home.
• How to prepare for the new Planning Gain Supplement.
• The strange quirks of selling inherited property.
• How to avoid Capital Gains Tax on second homes.
• How to get value out of rental losses.
• How to use lease premiums to generate tax-free income.
• How to make tax-free property transfers.
• How to get Principal Private Residence relief on business property.
• How to get 40% of your renovation costs paid by the Government.
• Year end tax planning for property businesses.
• How to use VAT to help increase your rent.
• VAT planning for commercial property, conversions and listed buildings.
• How to avoid paying National Insurance with rental income.

About the Author of How to Avoid Property Tax

The Author of How to Avoid Property Tax is Carl Bayley BSc ACA. Carl’s speciality is his ability to take the complex world of taxation and set it out in the kind of clear language that taxpayers can understand. Carl is also a regular contributor to TV programmes such as the BBC’s It’s Your Money programme and national newspaper articles on tax matters. He is a member of the governing Council of the Institute of Chartered Accountants in England and Wales.

Contents of How to Avoid Property Tax

Introduction

Scope of this Guide

A Word about the Examples in this Guide

Chapter 1 What is Property Tax?
1.1 Knowing Your Enemy
1.2 What Taxes Face a Property Investor?
1.3 Which Taxes Are Most Important?
1.4 How Does Property Tax Compare with Tax on Other Types of Income?
1.5 What about Capital Taxes?
1.6 Dealing with Revenue and Customs

Chapter 2 What Kind of Property Investor Are You?
2.1 Introduction
2.2 Does it Matter What Kind of Property You Invest In?
2.3 Property Investment (or Property Letting)
2.4 Property Development
2.5 Property Trading (or Property Dealing)
2.6 Property Management
2.7 Casual Property Income
2.8 Advantages and Disadvantages of Investment or Trading
2.9 The Boundary Between Investment and Trading
2.10 ‘Mixed’ Property Businesses
2.11 Other Property-Based Trades
2.12 Husbands, Wives and Civil Partners
2.13 Joint Ownership & Property Partnerships

Chapter 3 How to Avoid Income Tax
3.1 Introduction to Income Tax
3.2 Basic Principles of Income Tax
3.3 Income Tax Rates
3.4 Calculating the Income Tax Due
3.5 Tax Returns
3.6 Registering a New Property Business
3.7 Non-Residents, etc
3.8 Claiming Deductions
3.9 Administrative Expenses
3.10 Capital Allowances

Chapter 4 Avoiding Income Tax on a Property Investment Business
4.1 The Taxation of Rental Income
4.2 Deductible Expenditure
4.3 When is a Property a Rental Property?
4.4 Interest and Other Finance Costs
4.5 Legal and Professional Fees
4.6 Repairs and Maintenance
4.7 Training and Research
4.8 Capital Allowances for Letting Businesses
4.9 Furnished Lettings
4.10 Rent-a-Room Relief
4.11 Rental Losses
4.12 Other Property Investment Income
4.13 Lease Premiums
4.14 Overseas Lettings
4.15 Non-Commercial Lettings

Chapter 5 How to Avoid Tax on a Property Trade
5.1 The Taxation of Property Trading Income
5.2 Properties as Trading Stock
5.3 Work-in-Progress & Sales Contracts
5.4 Accounting Date
5.5 National Insurance
5.6 Trading Deductions: General
5.7 Trading Deductions: Specific Areas
5.8 Capital Allowances for Property Trades
5.9 Property Management Trades
5.10 Trading Losses

Chapter 6 How to Avoid Capital Gains Tax
6.1 The Importance of Capital Gains Tax
6.2 The Development of Capital Gains Tax
6.3 Who Pays Capital Gains Tax?
6.4 Capital Gains Tax Rates
6.5 What is a Capital Gain?
6.6 When Does a Capital Gain Arise?
6.7 Husbands, Wives and Civil Partners
6.8 The Amount of the Gain
6.9 Proceeds
6.10 Base Cost
6.11 Base Cost – Special Situations
6.12 Capital Gains Tax Reliefs
6.13 The Principal Private Residence Exemption
6.14 Private Letting Relief
6.15 Planning with Principal Private Residence Relief
6.16 Gardens and Grounds
6.17 Delays in Occupying a New Home
6.18 Temporary Absences
6.19 Dependent Relatives
6.20 Properties Held in Trust
6.21 What is a Residence?
6.22 Second Homes
6.23 Homes Abroad
6.24 Job-Related Accommodation
6.25 What if Part of Your Home is Not Private?
6.26 Letting Out Part of Your Home
6.27 Using Part of Your Home for Business Purposes
6.28 Entrepreneurs’ Relief
6.29 The Annual Exemption
6.30 When is Capital Gains Tax Payable?
6.31 What Must I Report to HM Revenue & Customs?
6.32 Jointly Held Assets
6.33 Capital Losses
6.34 Leases

Chapter 7 Other Taxes to Watch Out For
7.1 Stamp Duty – Introduction
7.2 Stamp Duty Land Tax
7.3 Who Pays Stamp Duty Land Tax?
7.4 Market Value and Mortgages
7.5 Linked Transactions
7.6 Stamp Duty Land Tax on Leases
7.7 Disadvantaged Areas
7.8 Fixtures and Fittings
7.9 Zero-Carbon Housing
7.10 First-Time Buyers
7.11 Stamp Duty on Shares
7.12 VAT – Introduction
7.13 VAT on Residential Property
7.14 VAT on Commercial Property
7.15 VAT on Property Management
7.16 Interaction of VAT with Other Taxes
7.17 National Insurance

Chapter 8 Advanced Tax Planning
8.1 Introduction to Tax Planning
8.2 The Benefits of Joint Ownership
8.3 Using Your Spouse or Civil Partner
8.4 Have Your Cake and Eat it
8.5 Marriage, Divorce and Civil Partnerships
8.6 Inherited Property
8.7 Tax-Free Property Transfers
8.8 Why ‘Let to Buy’ Beats ‘Buy to Let’
8.9 Climbing the Ladder
8.10 General Elections
8.11 Developing Your Home
8.12 Something in the Garden
8.13 Student Loans
8.14 Using a Trust to Get Extra Principal Private Residence Relief
8.15 Furnished Holiday Lettings
8.16 Tax-Free Holiday Homes
8.17 Hotels and Guest Houses
8.18 Entrepreneurs’ Relief on Investment Property
8.19 Enterprise Investment Scheme Shares
8.20 Sweet Shop Companies
8.21 Emigration
8.22 Flat Conversion Allowances
8.23 The Tender Trap: The Benefits and Pitfalls of Re-Mortgaging
8.24 Non-Domiciled Investors
8.25 Using Lease Premiums to Generate Tax-Free Receipts
8.26 The Rental Loss – Capital Gain Dilemma
8.27 Winding Down Gracefully
8.28 Commercial Developments in Assisted Areas
8.29 Rollover Relief
8.30 Year End Tax Planning
8.31 Using Your Basic Rate Band to Save Capital Gains Tax

Chapter 9 Planning With More Complex Structures
9.1 Using a Property Company to Save Tax
9.2 Partnerships
9.3 Limited Liability Partnerships
9.4 Property Syndicates and Special Purpose Vehicles
9.5 Pension Schemes
9.6 Other Ways to Invest in Property

Appendix A: Tax Rates and Allowances

Appendix B: Indexation Relief Rates

Appendix C: Short Leases

Appendix D: The European Union & The European Economic Area

Other Taxcafe Products & Services

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