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Stamp Duty Land Tax (SDLT) must also be considered. SDLT is paid in relation to the VAT-inclusive sales price. The buyer could look to negotiate a reduction in price to compensate for the additional SDLT suffered as a result of making an option to tax Except for the 6-month ‘cooling-off period’, an option to tax cannot be revoked for 20 years, so further changes in intention could be negatively affected The option to tax must be made at the correct time and notified to HMRC in the correct manner
Whilst this approach is generally accepted by HMRC, it is a complex planning opportunity. It is strongly recommended that professional advice is taken in respect the development before it is relied upon as part of a proposed contract. How we can help The purchase, development and sale of land and property can be a complex and costly business and one in which the services of a trusted professional adviser is crucial. Whether you are looking to buy or sell land, develop property, or invest in a private rental portfolio, we have a team of specialists who have been selected from across our business for their experience in the sector and who are ready to help you with all aspects of your financial and business affairs.
Our land and property team includes tax, accountancy, insurance, and corporate finance professionals who have extensive expertise and knowledge of trends in this sector. We have individual specialists in challenging areas such as Stamp Duty Land Tax and property insurance. Our clients include private individuals, limited companies, landed estates, institutions, charities, and public organisations. Please contact Daniel or one of his colleagues in the tax team at hello@scruttonbland.co.uk or tel 0330 058 6559.
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Make the most of any golden bricks Where a dwelling is being constructed and work has progressed above foundation level, the sale of that dwelling to a buyer who will continue the development, may be treated as a zero-rated sale – thus avoiding the potential issues of irrecoverable VAT for both buyer and seller. This concept of building just above the foundation level is informally known as the ‘golden brick’.
P R O P E R T Y A N D CONSTRUCTION | SCRUTTON BLAND | 1 1
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