In terms of funding announcements, some key headlines are:
• £1.7 billion worth of projects to upgrade local infrastructure.
• A further £1.8 billion to meet the government's commitment to £10 billion investment in housing supply and unlock over 1 million new homes.
• £11.5 billion investment through the Affordable Homes Programme (2021-26) delivering up to 180,000 affordable homes.
• Around two thirds of the Affordable Homes Programme funding will be for homes outside London.
• £5 billion funding for remediation of the highest risk buildings with unsafe cladding to ensure everyone can feel safe and secure in their home.
• The continued regeneration of some 170 high streets, town centres and local communities across England through the Towns Fund.
• £9 million in 2022-23 to fund more than 100 green spaces across the UK on unused, undeveloped, or derelict land that will broaden accessibility for all.
Commenting on the new Budget announcements, Rebecca Wilkinson, tax partner at accountancy firm, Menzies LLP, said: "These funding announcements are good news for the property and construction sector as they will ensure the continuation of major construction projects. Sadly, there was no mention of any kind of visa changes to aid construction companies with finding much needed labour to combat shortages."
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Rebecca also comments on some of the specific announcements as follows:
• New property developer tax – "While we knew this was coming, we didn’t have the detail. Now we know that the tax will be a 4% levy on profits made on UK residential property developments. It will only apply to developers with an annual profit in excess of £25m. The levy will be used to pay for replacing unsafe cladding on residential buildings. Smaller scale developers will be relieved that the tax won’t apply to them."
• Extension of the £1m Annual Investment Allowance (AIA) until 31 March 2023 – "The £1m AIA was due to reduce to £200k from 1 January 2022. The extension of the higher limit to 31 March 2023 will benefit businesses in the property fit-out sector particularly, as it will provide customers with faster tax relief on qualifying capital items, making fit-out work more affordable. It should also help businesses that might be considering doing major fit-outs but have been unable to start the work in 2021 due to shortages of labour and supplies."
• Extended payment deadlines for payment of CGT on residential property disposals – "The current deadline for paying CGT following the sale of a residential property is just 30 days. In order to pay the tax, taxpayers have to set up an HMRC gateway account, which can take time to process. Due to this, taxpayers often find the 30-day deadline hard to meet. The extension is a welcome move as it allows taxpayers greater time to comply with their tax obligations."
New business rates reliefs were also announced. Rebecca said: "This is great for the property sector as it helps maintain confidence in the high street and should encourage continued investment in towns."
• Up to 400,000 retail, hospitality and leisure properties will be eligible for a new, temporary £1.7 billion of business rates relief next year.
• From 2023, a new business rates relief will support investment in property improvements so that no business will face higher business rates bills for 12 months after making qualifying improvements to a property they occupy. This should hopefully encourage businesses to invest in improving buildings, providing work for the property sector.
