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“I left everything to my adviser” might seem like an acceptable approach to take. Taxpayers may also be forgiven for thinking that it provides them with a reasonable excuse if something goes wrong with their tax affairs.   

Mark McLaughlin highlights a potential danger for taxpayers who rely on their advisers to deal with HMRC on their behalf.

Recent statistics show that in 2023, 28% of all young people aged 20 to 34 years were living at home with their parents. Whatever the scenario, having an extra adult in the household means extra costs such as increased utility bills, groceries, and other living expenses, leading many to pay rent. 

Jennifer Adams outlines the tax implications of renting a room to another family member such as a sibling. 

It is a common theme of direct tax law that the tax follows whoever is entitled to benefit, be it from the income in question, the use or enjoyment of an asset, or the proceeds arising from disposal. From a capital gains tax (CGT) perspective, HMRC’s Capital Gains Manual states at CG10702 (and echoed at CG10720):

‘The person chargeable is normally the `beneficial’ owner of the asset which has been disposed of. Any actions by nominees, bare trustees, [mortgage holders, etc.], are attributed to the beneficial owner so that any gain or loss accruing on an actual disposal of the asset by the nominee, etc., accrues to the beneficial owner (and not the nominee). The transfer of legal ownership between a nominee and the beneficial owner does not constitute a disposal for the purposes of TCGA 1992.’

Lee Sharpe considers a recent tax case that may be of use to taxpayers whose family or friends have helped out with buying property.

There are different rates of stamp duty land tax (SDLT) for residential properties and for non-residential and mixed properties. In addition, a supplement of 5% applies to the purchase of second and subsequent residential properties. The addition of the supplement can make buying residential properties for investment (for example, as a buy-to-let) expensive. By contrast, there is no supplement on the non-residential rates. 

Sarah Bradford looks at what the increase in the SDLT supplement will mean to those purchasing second and subsequent residential properties.

Property partnerships seem popular these days – typically, as a stepping-stone to greater things. Regular readers will know that I have long criticised HMRC’s published position on whether a property partnership exists, as distinct from simply co-owned property. My argument is that HMRC has drawn up its guidance to set an unreasonably high threshold to ‘make the grade’ as a partnership.

Lee Sharpe looks at whether a joint property letting activity amounts to a partnership, and why it is relevant to landlords.  

Most people do not expect to have to pay capital gains tax (CGT) when they sell their home. Private residence relief (also known as main residence relief or principal private residence relief) normally applies in full when the property has been the taxpayer’s only or main residence throughout the whole period for which they have owned it.  

Sarah Bradford outlines the concept of a ‘main’ residence for capital gains tax purposes. 

The government (HMRC) has become increasingly worried about the volume of small and medium-sized enterprise research and development (R&D) tax credit payments where a company claims to have undertaken eligible R&D activity (and it is important to keep in mind that only certain types of R&D may qualify – there are a lot of criteria).

Lee Sharpe looks at tax aspects of modernising property and the risk of disallowance as improvements that constitute capital expenditure, losing income tax relief in the property business. 

Whether to buy commercial or residential property depends on various factors, not least the more beneficial tax system for commercial lets and whether an individual or a company is purchasing the property. The government wishes to encourage commercial lets and therefore permits a more generous tax regime than residential lettings. 

Jennifer Adams considers some important tax benefits of investing in commercial property.