The budget yesterday provided greater clarity on property taxation.

Expert advice is needed to ensure that the tax liability is properly managed. Property Inside London provides clients with leading advice.

Below is the text of an announcement from Mishcon de Reya, Solicitors

“The Government’s aim is still to penalise owner-occupiers who own their property through a company. To discourage them, a new annual charge (referred to as the “Annual Tax on Enveloped Dwellings”) will apply from 6 April 2013 to companies owning a residential property worth over £2m. CTG at 28% will also apply to companies that dispose of a property worth over £2m and only on gains that accrue from April 2013 onwards. For genuine property development and investment businesses, there are reliefs and exemptions, including reliefs from the 15% SDLT rate introduced in March 2012. Disappointingly, the Government failed to bring forward the SDLT relief, which will only apply from Royal Assent of Finance Bill 2013, likely to be July this year. This leaves an unwelcome limbo period between now and July where developers and landlords, who would otherwise be able to claim relief and pay a reduced 7% rate of SDLT on new purchases, will remain stuck with the 15% rate. Expect a quiet few months in the prime residential investment and development market. As for £2m+ residential properties held in existing corporate structures, these should be examined now action taken to avoid the new tax charges.”

Please click here for a link to their tax summary guide (Tax guide ) and Knight Franks summary and analysis (Summary ), both of which were issued before the budget.