Dear Forum,
Please help with this general scenario as outlined below:
1. Mr & Mrs X have a Principle Residence
2. Mr & Mrs X get a planning permission to build two semi-detached houses in the Principle Residence Garden
3. Mr & Mrs X set up a SPV Ltd company with Mr & Mrs X both being Directors to build and sell the houses for a revenue of £800k
4. Mr & Mrs X sell our Principle Residence consented land to the SPV for £400k
5. Mr & Mrs X employ a builder the Development cost is £400k and the SPV makes minimal / zero profit
For the one off payment of SDLT on the £400k land by the SPV will there be any tax liability, i.e. Corp Tax and / or CGT Personally on the Directors.
Is this a viable route to take when considering the following points and any others that you can think of:
• Selling land to yourself / a company that we are Directors of and arms length transaction rules
• Whether it attracts a capital gains for us personally
• Directors loan rules when the company owes you £400k
Thank you forum experts for your help.
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