Why Every Developer Should Work With a Specialist Property Accountant

Property developers work in a sector that commands considerable financial management. Developers benefit from expert advice when making decisions around property or land acquisitions, marketing completed developments, and securing opportunities to build affordable housing in high-demand areas.

One of the key advantages of working with our experienced, highly qualified development and property accountancy team is that we take the pressure and time burden of bookkeeping, accounts preparation, ongoing management accounting and accurate returns off your shoulders.

Rather than losing the capacity to fully focus on current projects, leaving tax returns, accounting submissions and declarations to the last minute, or running a risk that your cash flow will become unbalanced, we step in to cover every accounting need.

What Do Accountancy Services for Property Developers Include?

James Todd & Co has years of expertise, and as such, we tailor the level of support and oversight you need to your property development business. 

That might, for example, look very different for a fairly new developer who needs customised mentoring and a growth strategy, an independent developer who wants help with everyday accounting, and a seasoned development company that wants to outsource financial administration.

Our overarching aim is to add value by providing updated advisory support on changing regulations or tax obligations, suggesting the best ways to manage tax exposure, and ensuring you can concentrate your energy on your developments without any potential for late filings or cash flow bottlenecks.

As specialist property accountants, we also support developers with more complex business structures or partnerships. Many might deal with new-build developments and housebuilding projects, renovating and retrofitting outdated multi-tenant properties, or bringing vacant commercial properties back into usable condition.

Other clients act as sole traders and work on individual developments to transition these into buy-to-let investment properties, adding to a rental property portfolio. This means that personalised support from a knowledgeable accountancy team must be tailored to where and how we can offer the best level of accountancy assistance.

Typical Financial Management Requirements for Property Development Requirements

As a brief overview, a large proportion of the developers we work with rely on James Todd & Co to manage the everyday aspects of tracking profits and margins, claiming all available tax reliefs and allowances, and submitting accurate returns. They may require:

• Construction Industry Scheme (CIS) support, including understanding the correct registration process as a contractor or subcontractor, handling monthly payments and returns, and verifying the status of subcontractors and applying the right deduction rates.
• Corporation tax calculations and returns for limited companies, applying those reliefs we’ve mentioned, avoiding paying unnecessarily high tax due to reporting errors, and budgeting for tax obligations within forecasts.
• Management accounting, producing regular, insightful reports that provide relevant information about the business’s financial position, forecasting cash flow gaps or reserves, and ensuring that developers stay informed about the financial health of their business.

Strategic planning is always at the heart of our services, and in the fast-changing construction and property sectors, an accomplished accountancy team can be invaluable. We can advise on the impacts of proposed reforms, help you make key decisions about company structure and trading options, and ensure your accounting and record-keeping software is fully compatible and secure.

Property Development Financial Management Services Outside of Regular Reporting and Tax Filings

As all our long-standing clients are aware, we believe that timely and relevant planning is a crucial aspect of business success. That’s because operating in a silo without awareness of market trends or risk profiles can mean that otherwise viable businesses become exposed to unacceptable levels of risk.

Many newer or scaling development clients take advantage of our Goals to Growth service; however, even long-established developers may not have the capacity or time to thoroughly examine their financial performance and ensure that a feasibility analysis supports each decision they make.

Budgeting and cost controls go hand in hand with this depth of analytics, because the property investments developers make can be substantial. Without clarity about the anticipated returns or the contingencies built into those budgets, it is impossible to make informed judgments.

Comprehensive, project-specific budgeting enables developers to stay ahead of land and property acquisition values, the ongoing and real-time costs of construction and renovation work, the likely values associated with marketing completed developments, and the availability of contingency funds in case developments overrun in terms of cost or time.

In many cases, there are cost-saving opportunities, which may relate to gaps in the market where developers can react quickly to bolster their revenues, tax planning initiatives to reduce business liabilities, or reviewing static and variable overheads to identify areas where they can be trimmed.

The Importance of Professional Tax Planning for UK Property Development Professionals

Tax mitigation and management are necessary parts of doing business, and in recent months, with a raft of reforms, changes, and frozen tax bands, it’s also something developers shouldn’t ignore. Our accountancy teams can both put together tax-efficient strategies to maximise net profits and ensure developers are well-versed in all the incentives, reliefs and requirements that need to be complied with.

However, compliance extends beyond the financial and statutory, because developers must be conscious of sector-specific regulations and legal obligations to safeguard their businesses. As a few examples, these include:

• Building Regulations: evidencing the quality of new constructions or renovations
• The Building Safety Act 2022: carries obligations for developers around structural stability and fire safety management
• Planning Permission consent and permitted development rights, where applicable
• Environmental regulations: analyse the impact of each development and ensure provisions have been made to limit erosion or handle surface water drainage

Developers must also be aware of consumer law, particularly when managing contracts with individual consumers, as well as the terms and conditions of all financial agreements and contracts they may enter into as part of their business operations.

Discover the Benefits of Working With a Uniquely Experienced Property Accountant

We’ve worked with developers of all sizes for many years and appreciate the complexities of running development businesses, liaising with investors, lenders, and buyers, while operating a buoyant and financially stable company that stays up to date with tax reforms and obligations.

Building risk management into decision-making and creating reporting structures to provide clarity and certainty about your finances at every step is ideal, ensuring you can focus on your business without any concerns.

To learn more about accountancy for property developers and other professionals working within the property sector, you are welcome to contact the James Todd & Co team at any time.