The government announced in February 2021 that it would introduce a new Residential Property Developer Tax (RPDT) as part of its Building Safety Package. The tax is one of the government’s measures to bring an end to unsafe cladding, provide reassurance to homeowners and support confidence in the housing market.
In July, AREF responsed to the consultation on the design of the RPDT ahead of its inclusion in the 2021-22 Finance Bill. AREF put the case forward for the build-to-rent sector to not be in scope for this tax.
On 21 September, HM Treasury launched a technical consultation on the draft legislation of the RPDT which ran until Friday 15 October. At this time AREF was notified by HM Treasury that build-to-rent would not be within the scope of RPDT.
In the 2021 Autumn Budget, the Government confirmed they would introduce RPDT from April 2022. The tax will be charged at 4% on profits exceeding an annual allowance of £25 million. More details can be found in the Government’s response to the consultation.