Tax Dispute on Baker Street
This property is a substantial development comprising of 78 high value properties from two bedroom flats up to duplex four bedroom split level apartments with roof terracing. In addition, there are two floors of underground car parking with over 100 spaces accessed by two large car lifts and a ground floor gymnasium and retail unit.
The property was subject to negotiations with the District Valuers office over a tax computation. The property was purchased by the existing owners in approximately 2009 and was valued for tax purposes by the District Valuer at a figure of over £110,000,000; the figure was disputed by Richard Alford acting on behalf of the owners.
Negotiations took place over a period of 18 months with the District Valuers office. The approach taken by the District Valuer was to value the subject property on the basis of standard Capital Gains Tax Assessments applying an individual value to each of the flats without any recourse to deductions for quantum, holding management repairs, insurance or sales costs.
The final tax computation was reduced by a figure of over £23,000,000 (Twenty Three Million Pounds).
The case is particularly important in that it has set, in the opinion of Richard Alford, a precedent with the District Valuers office whereby deductions to reflect these aforementioned costs should be taken into account where properties of such scale are purchased by investors.