The Ministry of Housing announced on 10th February 2021 that it planned to introduce a new residential property developer tax (RPDT) as part of its Building Safety package to fund the replacement of non-compliant cladding on high-rise buildings.
It’s only likely to effect large developers as in would only apply to in-scope profits of £25m, it’s hoped the tax could raise £2bn over 10 years and will fund the removal of unsafe cladding in the UK.
Critics of the proposals say developers will be taxed on proposed profits excluding any finance or interest costs when calculating the profits. As interest is a major cost for many developers the tax could push a profitable development into a loss.
The tax is due to come into force in 2022, do you agree with the proposals?
#RPDT #developerstax #cladding