<p>Filter Knowledge</p>

We recently hosted a webinar on the UK's new Qualifying Asset Holding Company Regime (QAHC) which will come into effect from April 2022.

In this briefing we look at 12 of the changes to law and practice that are likely to impact on the real estate sector in 2022.

On Tuesday 30 November 2021, the government published a series of tax-related consultations and policy papers as part of 'tax administration and maintenance day'. Among these were a number of interesting consultations relating to real estate.

As part of the government's review of the UK's fund regime, and its wider efforts to enhance the UK's attractiveness to asset managers and investment funds, a number of changes are to be made to the UK's REIT regime with effect from 1 April 2022. Further changes to the REIT rules are likely to follow further down the line as the review progresses.

The last few months have seen several significant developments in relation to tax. Whilst perhaps the most headlines were generated by the OECD’s announcement that agreement has been reached on the introduction of important changes to global corporate tax rules, there have been several noteworthy developments from a domestic tax perspective, including the provision by the UK government of more details of the new tax on residential property developers and the new tax privileged regime for asset holding companies, both of which are due to come into force next April.

Tax analysis: HMRC has launched a consultation on the draft legislation for the Residential Property Developer Tax (RPDT) ahead of its inclusion in the 2021–22 Finance Bill. This follows the government holding a consultation seeking views on the policy design of the new RPDT between 29 April and 22 July 2021. Ian Zeider, knowledge counsel at Travers Smith and Cathryn Vanderspar discuss the draft legislation and possible issues.

Since this article was written, there have been some changes to the tax breaks discussed, including the periods over which they are available;  for more information, please speak to any of the Tax contacts listed at the end of the briefing.

This consultation is on the second "tax measure" announced by the Treasury ("HMT") in the March Budget – a new Gateway 2 Levy on high rise residential developments during the pre-construction stage. This is part of a package of measures intended to help pay for the remediation of certain buildings impacted by the cladding crisis, following the Grenfell Tower tragedy (the "Building Safety Levy").

With 92 UK REITs already in existence and more anticipated, following extensive industry discussions, the government is keen to ensure that the rules facilitate use of the regime and make it more attractive by removing certain constraints and administrative burdens.

In February, the Government announced a package of measures intended to resolve the problem of unsafe cladding on high-rise residential buildings.  

This series of bitesize videos will be a chance to hear from various members of the Real Estate team on need-to-know updates and topical issues in the sector.

The government is consulting on the design of a new tax, on residential property developers to help fund the removal of unsafe cladding following the Grenfell Tower fire tragedy. The idea is to raise at least £2bn over a decade.

There was good news for landlords recently, as the government announced amendments to Finance Bill 2021 to enable background plant and machinery in leased buildings to qualify for a super-deduction or an SR allowance.

Although making predictions is fraught with danger at the best of times - let alone during a global pandemic – here are three property-related tax announcements we would not be surprised to hear on 3 March.   

In the face of mounting pressure, the government, on 10 February, announced a 5 point plan for investment in building safety, with a further £3.5 billion earmarked for the removal of unsafe cladding.

Whilst the Covid-19 pandemic and the UK’s relationship with the EU post-Brexit have dominated the recent political and economic agenda, there are a number of important tax developments that those in the real estate sector should have on their radar for 2021.

Following last week's announcement that the new domestic reverse charge to be implemented for certain construction services will, again, be delayed – this time from 1 October 2020 to 1 March 2021, regulations have been published setting out more detail.