Mantas here from Southampton.
I have a large garden and wish to build one or two properties. Assuming I get the relevant planning permission for 1 or 2 dwellings, I wish to understand my tax liability. I have been doing some reading online and have found this to be a potential minefield.
The following scenarios
1) Sell the land with permission
The land is way less than 1.2 acres. If I continue to reside in main residence and the land is valued at around £100k. Will it be the case that no CGT is due, however once the funds deposited this will form part of my personal tax liability if so what will this be taxed at?
2) Sell the land through a ltd company
Same scenario as above but the land is transferred to a ltd company. The proceeds will be with ltd company. Again, will it be the case that the ltd company will be taxed according to corporation tax, then once the funds are withdrawn the relevant person will be taxed on dividends and income?
3) Self-build
For instance lets say I build the house, and sell it on straight away, and it sells for £290k, my total costs are £220k, leaving £70k of ‘profit’ if these where withdrawn directly would they be liable to CGT/Income tax? Could I also reclaim all the VAT as it will be a new build?
Apologies, my knowledge is very limited in this area.
