At Innovation 4 Business, we’re hugely proud of our ability to support our clients in making significant savings. Over 2021 so far, our expert team of tax specialists have helped our clients save over £11,090,000.
What sets us apart is our drive to build long-term relationships, allowing us to get to know our clients and source a solution within the right timeframe. We pride ourselves on our level of knowledge within the Stamp Duty Land Tax, Property Tax, Property Partnership Incorporation and Research & Development Relief markets, and have helped clients save over £1,557,500 in August alone.
An example of our ability is a recent case study involving a renowned property developer who saved just shy of £300,000. Our in-depth knowledge of the property landscape allowed us to assist our client with several refund claims, maintaining “first-class” communication throughout the entire process.
How we’re supporting our clients
Going into the later months of 2021 and moving further away from the financial brunt of the pandemic, we’re supporting our clients with a range of services to help them seize opportunities to save. Many of our clients have been approaching us for assistance with Stamp Duty Land Tax relief, and as specialists in this area, we’ve been able to support our clients in making significant savings on their property purchases.
One particular area of interest that could be of great use to our clients is multiple dwellings relief, which could, for example, be claimed on a home with an annex. Not only do annexes provide extra private space for relatives, grown up children or even holiday lets, but they can also help you make a saving on your stamp duty bill. To be considered an annex, it must be a separate building, or separate part of a single building that could be suitable as self-contained accommodation.
This could mean that converting an outbuilding or garage into an annex could boost the value of the property whilst lowering the rate of stamp duty land tax payable. This is ideal for developers looking to increase the desirability of their projects or for investors looking to save costs where they can.
The reason annexes can help buyers save on stamp duty is that they come under multiple dwellings relief, meaning that the amount of stamp duty tax payable is calculated on the average price per dwelling, which includes both the “main” property and the annex. The tax is multiplied by the number of dwellings, leading to a saving on your SDLT liability.
What’s in store for the future?
After 30th September 2021, the stamp duty threshold for residential properties will decrease from £250,000 to £125,000, with second homes/holiday homes incurring an extra 3% for properties valued up to £500,000.
Sales that are completed after 30th September 2021 will be subject to the lower tax threshold. It is likely that following this date, we may see a decrease in the number of property purchases as buyers have rushed to complete on properties before the deadline.
As well as the stamp duty holiday, the pandemic has also brought in other changes to the market, such as the rise in UK “staycations”.
There has been an increase in demand from UK holiday home investors, who have been wise to capitalise on the opportunity due to restrictions on overseas travel. This trend is likely to continue, as uncertainty regarding holidays abroad continues to prevail into the next year.
While the holiday home and staycation trend is positive for investors looking to enter the market, it’s important to note that these properties are subject to a higher rate of Stamp Duty Land Tax. As well as the regular rate of stamp duty, the buyer will also need to consider an extra charge, known as the “Higher Rates on Additional Dwellings” or HRAD. This is an additional 3% of your property purchase price, which investors will need to consider before jumping on the trend.
How can Innovation 4 Business help?
Whether you’re looking to purchase homes for buy-to-let investments or get started with your next development, our team’s in-depth knowledge of the property and tax sectors can help you avoid unnecessary charges.
We can offer pre and post-completion reviews in order to ensure the correct amount of stamp duty has been paid, and, where necessary, contact HMRC on your behalf to obtain a refund.
If you’d like to find out more about SDLT advice or getting a refund of stamp duty, get in touch with our specialist team by calling 0121 309 0222 or email firstname.lastname@example.org to see how we can help you make the best saving possible.