07 April 2016 #Commercial Real Estate
Stamp Duty Land Tax
From 17 March 2016 SDLT on commercial properties was brought in line with the residential system, whereby, the SDLT will now be charged at a variety of rates according to the portion of the total consideration that falls within each of the respective bands. In effect this means that all properties with non-rent consideration over £1.05 million will now be subject to greater SDLT than before.
The government has also introduced a new 2% band for rents with a net present value over £5 million.
Capital Gains Tax
Higher rate CGT is being cut from 28% to 20% and the basic rate from 18% to 10% as from and including 6 April 2016.
The old rate will remain on residential property gains and the private residence relief will remain so that an individual’s main residence will not attract CGT.
Insurance Premium Tax
This will be going up from 9.5% to 10% with the extra revenue going to improve the national flood defences.
Offshore property developers
The government is to create new legislation to target offshore property structures to ensure they cannot be used to avoid tax.
Small Business Rate Relief is to be increased to 100% meaning small businesses will get full relief on properties with a rateable value of £12,000 and below.
A shift in the rateable value threshold (to £51,000) from 1 April 2017 is also set to take a number of properties out of the higher rate.
Consultation is also ongoing on many levels with the government’s particular aim to improve the administration of the rates process.
New zones will be created in Cornwall, Dudley, Loughborough and Leicester with an extension of the Sheffield City Region. The zones will offer enhanced capital allowances.
Land Registry Privatisation
This is now a real possibility since initially being shelved during the coalition government. The sale will be a revenue raiser for the Government and it remains to be seen how it will affect the operation of the Land Registry.