Hamilton House, 1 Temple Avenue, London, EC4Y 0HA Telephone: +44 (0) 203 393 2750 Email: info@mdmw.london
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Dunne and Waterman Chartered Accountants London



Principle private residence relief

As explained under Capital gains tax and inheritance tax, we give clear and concise advice in connection with the availability of principal private residence relief on your main home if you sell it or give it away.

The rules have recently changed with the aim of restricting the relief, but it is still usually available in most cases. Nevertheless, this is an area which HMRC look at carefully, and it is vital that to obtain relief, the correct conditions must be complied with.

Many people consider selling a part of their garden for development, and this can be achieved with full exemption from tax, but again careful consideration of the legislation and your intentions is necessary.

Property development and investment

In addition to the main residence relief, at Dunne & Waterman, we also advise on the often subtle differences between trading in property and investing in property. The taxation of each is quite different and it is important from the outset to understand what you are trying to achieve and over what timescale, as there is plenty of opportunity to plan efficiently. For those who reside overseas, it is now even more important to understand recent changes to the taxation of 'enveloped' properties and the particular taxes which might apply.

Holiday lets

If you own a holiday let, whether in the UK or overseas, you may be able to benefit from certain tax advantages but you also need to know what to report and in which country.

We are able to advise you on the following:

  • If your property is overseas, what should you declare in the UK and what should you declare in the country in which the property is situated? Many advisors are unaware of the exact reporting requirements and double tax relief available.
  • The possible availability of complete exemption from inheritance tax if certain conditions are met.
  • The availability of a 10% rate of capital gains tax on a sale or gift of the property.
  • Possible claims for tax allowances on capital items which may be part of the purchase cost (for example a swimming pool). This can save considerable amounts of tax.

In many cases, you may simply need to complete the relevant pages of your self- assessment tax return, with which we can help if you wish, but we are also able to advise you whether you qualify for the above enhanced tax reliefs which can be available.

Renting your proprty

If you rent out your property, it is important that you declare the profit on your tax return even if you are not resident in the UK. Equally, if you own and rent out a property abroad, it is still necessary to declare that income on your UK tax return. It is a common misconception that this is not the case!

It is also important that you claim for all relevant expenses associated with the letting. What is classed as an improvement and therefore not deductible, and what is a repair, can be a fine line. It is sensible to take professional advice, where for example, you have purchased a property and spent a lot of money ‘doing it up’. Some of that expense may be able to be deducted from subsequent rents you receive so that your tax bill is reduced.

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Email Mark Waterman



Email Marie Dunne