Property developers

The ideal business structure of a developer depends on the size and risk profile of projects and your ambitions. 

Our knowledge of the sector will ensure that we can help you look at the pros and cons of various structures and determine the best fit for you and your business.

We can assist in redefining group structures to mitigate risk (eg, by using SPVs), or to provide clear lines of reporting and potential tax savings.

Additionally, where outside investors are involved we can help you to identify risks associated with the regulations of such activities and recommend specialists in Financial Services and the FCA, to take you through the compliance aspects of that. 

Finally, where a project is acquired as a Limited Company rather than a standalone site, we can assist you through that process and provide due diligence reporting as necessary to assist you to understand the risks associated with taking over an existing company.  

Effective management of the cost of every property project is vital and getting this right remains critical for every business.

Whilst every development has to cope with its inherent risks, your approach to how to manage this aspect of each project can make the difference for your long term business’ profitability and your ability to raise finance.

We have helped many construction businesses determine their best approach to this and are regularly called in to solve project issues.

By understanding your goals and the nature of your development activities, we can assist you to plan so as to achieve tax efficiency in your operations.

We have an award winning tax team who can proactively advise you on a myriad of taxes, which include: 

•        Capital Gains Tax and Entrepreneurs’ relief
•        Corporation Tax
•        Inheritance Tax and Business Property Relief
•        Land Remediation
•        Research & Development Tax Credits
•        Stamp Duty Land Tax
•        VAT

ATED returns (Annual Tax on Enveloped Dwellings) must be made each year and relief claimed regardless of whether any tax is payable.  We can assist you in this process.

Finding financing has become notoriously difficult for developers, with fewer sources of funding being available.

We have established relationships with the lenders who are best placed, and most supportive, to the sector and have experience of helping to achieve mutually satisfying outcomes for all concerned. We can assist with preparing development proposals, showing profitability, rates of return and cost of capital data.  In addition, we can advise on the nature and scope of regular reporting information that may be used for comfort by lenders.

In addition to bank finance, we can also provide advice and introductions for other available options for raising finance for your business.

The operation of VAT for Developers is highly complex as VAT on supplies can be exempt, zero rated or standard rated depending on the nature of development.  An option to Tax may or may not be appropriate and you need to be advised before you make your acquisition.

Sometimes a combination of rates will apply to a single property, and input VAT can be blocked on certain expenditure and the use of applications for payment, self-billing and authenticated receipts add to the complexity.

The consequences of getting the wrong rate can be severe and for this reason, developers are well advised to work with specialists who are familiar with the industry and are able to help your business not only stay within the rules, but also to maximise the VAT efficiency of your activities.

We can help with:

• Pre-tender or acquisition advice on the VAT implications of a proposed development, e.g, refurbishment, multi-unit new-build, conversion from non-residential, demolition etc.
• Advising on where an option to tax is appropriate and assisting in that process
• Advising on the correct rate of VAT to apply on sales
• VAT registration of SPVs
• Advising on correct rates of VAT to be applied by subcontractors
• Advising on most appropriate structures to maximise VAT efficiency.
• Advising on the correct operation of VAT where overseas projects are concerned.
• Advising on the advantages of VAT groups.
• Supporting businesses which are subject to VAT enquiries and disputes.

CIS is far reaching and covers many activities that are not immediately obvious, for example, property developers who acquire and renovate property are firmly within the scope of CIS so must register as contractors and apply the scheme rules to all relevant payments.

We can help by:

• Appraising you of the CIS rules and advising whether your activities are within scope
• Advising on whether certain contracts can be split
• Assisting you to establish robust procedures to operate CIS correctly and avoid penalties
• Assisting generally with your business’ overall tax compliance to retain/obtain gross payment status
• Supporting you in dealing with HMRC enquiries

Your accounts are important. 

They are the measure by which financiers, investors and other stakeholders will form a view of your business performance.  So when we, as Chartered Accountants, ensure your statutory accounts meet the disclosure requirements of either UK GAAP or IFRS, we go just that bit further – we consider how we can, within the constraints of those accounting regulations, best display the true picture of your business.  

We have many years’ experience of auditing property development businesses and are specialists in understanding and applying not only the accounting rules but also the pattern of activity that developers are faced with, which in some cases can mean years of relatively high sales and years with little or no turnover. 

Such variations present risks associated with finance and profitability, whilst also presenting opportunities for tax planning.  The benefits to our clients are

• A team who are conversant with the industry and specific rules for accounting for properties under development, and stock and work-in-progress.
• A full awareness of the funding, planning and development process.
• An understanding of defects provisioning and developers’ ongoing obligations on new build development.

We developed our online accounting service in order to be able to streamline the service we provide to our clients by eliminating unnecessary time spent on data transfer and enabling us to focus our time on getting straight to work on the data itself.

Since then of course, online access to bank accounts and instant communication has become a feature of the modern business. 

In addition to the improved efficiency (and lower costs) of the service we can provide, it also means that we have open communication with our clients and are able to provide real time answers.