Taxable property

What is taxable property?

There are two categories of taxable property, residential and taxable moveable property.

• Residential property is simply a building or structure used, or capable of being used, as a dwelling. Land adjoining or intended for use connected with a dwelling would also be deemed residential.
  
  It is misconception that residential property that is being used as a business, perhaps as a buy-to-let or holiday home, can be deemed commercial property. HMRC will see the building as what it is irrespective of its current use. After all, any leasing agreement can be terminated at any time at which point the asset would revert to residential in any event. 

• Tangible moveable property is, as the name suggests, is any asset that can be touched or moved. The intention of the legislation here was to prevent investment into classic cars, antiques, jewellery and such-like. However, defining tangible movable property is more complex than you might expect. 
  
  Tangible movable property includes not only items such as works of art, antiques, vintage cars, stamps and jewellery but also plant and machinery, motor vehicles, office equipment and fixtures, and fittings and furnishings that are not part of the fabric of a building.

Direct investments in taxable property

Direct investment by a pension scheme in taxable property is an unauthorised payment and could give rise to tax charges on the member(s), the pension scheme (via the Scheme Administrator), and any income (or, if greater, deemed income of 10% of the value of the pension scheme’s interest in the taxable property) and any capital gains in relation to the investment.

Indirect investments in taxable property

By investing in a vehicle that holds such property, directly or indirectly, and where that vehicle is not a genuinely diverse commercial vehicle, it could give rise to similar tax charges, although any item of tangible moveable property that is worth no more than £6,000 and is held solely for the purposes of the administration or management of the vehicle’s business is excluded. Investment grade gold bullion is also excluded.

We do not allow investment in taxable property.