Business rates are the primary form of property tax for non-residential properties, including commercial premises like offices, shops, factories, and warehouses. These rates are calculated based on the rateable value of the property, which is assessed by the Valuation Office Agency (VOA). The rates vary by location and are set by local authorities. Small businesses may be eligible for rate relief.
SDLT is a one-time tax imposed on the purchase or lease of non-residential properties, including commercial properties. The tax rates are tiered, with different bands and rates depending on the property’s purchase price. SDLT is also applicable to leases, with different thresholds and calculations for leasehold transactions.
When a commercial property is sold, Capital Gains Tax may be levied on the profit made from the sale. The rate of CGT depends on various factors, including the individual’s income and other capital gains.
Council tax is a property tax imposed on residential properties in the UK. The amount payable is determined by the property’s council tax band, which is based on its value as of 1991 in England and Scotland (2003 in Wales). Each local authority sets its own council tax rates.
SDLT is also applicable to the purchase of residential properties. Like commercial properties, SDLT rates vary based on the purchase price. There are specific rates for first-time buyers, and higher rates apply to additional property purchases.
When selling a residential property, CGT may be applicable to any profit realized from the sale. However, there are exemptions and reliefs available, such as Principal Private Residence Relief, which can reduce or eliminate the CGT liability.
ATED is a tax that applies to high-value residential properties owned by companies, partnerships, or collective investment schemes. The tax rate varies based on the property’s value.
Feeling lost and overwhelmed when it comes to choosing the ideal tax structure for your next commercial or residential acquisition? We know it can be daunting, but don’t worry! Salty Digits is here to help. With years of experience in this field, our team provides you with the best guidance possible when it comes to navigating the complex world of property tax in the UK.
