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Anyone buying a property for rent on a long-term basis will probably bedeemed an investor by HMRC, whereas someone buying to refurbish and then sell (whether resulting in a gain or not)could be deemedas trading or dealing in properties and be taxed accordingly. 

The two factors to consider are firstly, intention (the reason for the purchase) and secondly, whether the transaction has the characteristics of being a trade. If it can be shown that the property had been purchased for its income, then the fact that it was sold as a result of getting a good offer shortly afterwardsneed not convert the transaction into one of being a trade.  

In deciding whether the transaction is a trade, HMRC will refer to what are termed the ‘badges oftrade’ using the same headings as fordetermining whether a self-assessment business is a ‘trade’. 

The benefits of being deemed a ‘trading’ activity rather than ‘investment’ include:  

BADR would be applied to the outright sale of a trading business (rather than the sale of individual assets).Under this relief, the gain is taxed at 10% on the first £1 million of eligible gains made in a lifetime rather than at the higher CGT investment tax rates. A particular problem may arise for those engaged in the property business in some way (e.g., a builder, surveyor, or estate agent). Even though the purchase itself may have nothing to do with their trade, HMRC could try to argue that the purchase of land and subsequent sale is a tradingtransaction.