What are the incentives?
There are four types of incentives:
- Urban Renewal Bond
- Investment Tax Credit
- Tax Relief on Rental Income
- Exemption from Transfer Tax and Stamp Duty
1. Urban Renewal Bond (URB)
The Urban Renewal Bond are loan instruments which may be issued, or underwritten by approved private and public sector organizations to mobilize funds for specific projects within the SDA.
2. Investment Tax Credit
The incentive is a tax credit on capital investment, where Government gives incentives for either the construction of new buildings or improvement to old ones. This is available to approved developers, as a tax credit of 33 ⅓ % on capital sums invested, which is set-off against other income tax liability or the developer, from any other source but limited to 50% of that liability in any one year of assessment. Developers must prove "approved developer" status to the Income Tax Department at the time of filing tax returns.
3. Tax Free Rental Income
Full relief from Income Tax on rental income from the new or refurbished buildings is available to approved developers during the incentive period. In addition, every transfer of title to improved property by an approved developer, is exempt from Transfer Tax during the incentive period.
4. Exemption from Transfer Tax and Stamp Duty
During the incentive period every transfer of title to any improved property or lands by an approved developer is exempted from transfer tax and stamp duty.