Jennifer Adams considers the reasons a landowner may wish to separate land from their main residence and the possible tax implications in doing so.
Subdividing land will generally be for one of the following three purposes; where the owner intends to:
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develop the land to retain it for a specific purpose (e.g., building a separate 'granny annexe');
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develop the land for selling at a profit or for renting out; or
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sell the land to a third party for development and sale.
Building a ‘granny annexe’
Building a 'granny annexe' in the grounds of an existing main residence does not have any immediate direct tax implications. However, issues may arise when considering the main residence's
