Key points
- The residential property development tax (RPDT) will be levied at 4% on property development companies with annual profits in excess of £25m.
- The tax is planned to operate for ten years – with an estimated £200–250m expected to be raised annually.
- The term ‘residential’ for RPDT purposes is broad.
- No deduction is allowed for any interest.
The autumn Budget on 27 October 2021 included the important announcement that residential property development tax (RPDT) will be levied at 4% on companies or groups of companies undertaking UK residential property development with annual profits in excess of £25m. It is expected to operate for only ten years although keen historians might note that income tax when first introduced on 9 January 1799 by William Pitt the Younger was ‘a temporary measure’ and had a reassuringly low rate of just under 1% on annual incomes of £60 a...