Social housing providers will be exempt from Residential Property Developer Tax

The government has confirmed that social landlords will be exempt from the Residential Property Developer Tax (RPDT) when it is introduced next year.

Amendments to the draft Residential Property Developer Tax legislation published last week (8th October) confirmed that “non-profit housing companies”, currently defined as non-profit registered providers of social housing in England, registered social landlords in Wales and Scotland and registered housing associations in Northern Ireland. The legislation also leaves space for the government to amend the definition of non-profit housing companies by regulation.

However, where a commercial developer that does not meet these criteria builds ‘affordable housing’, profits made will remain subject to the new tax.

Other developments that will exempt from the tax include student accommodation, a home or other institution providing residential accommodation for children, a home or other institution providing residential accommodation with personal care for persons in need of personal care because of old age or disability, past or present dependence on alcohol or drugs or past or present mental disorder.

Residential accommodation for members of the armed forces, members of the emergency services or persons working in a hospital will also be exempt.

Further details, including the rate of the RPDT and tax-free allowances, are expected to be included in the Budget on 27th October.