Sometimes you win, sometimes you learn..
Option agreements have been in use since being created by the philosopher Thales, one of the legendary Seven Wise Men of antiquity, around 300 years before Socrates
Thales spent most of his time philosophising on water as the essence of all matter, with Earth a flat disk floating on a vast sea
Eventually, he grew tired of taunting by peers along lines of ‘those who can, do, those who can’t, philosophise’ (a phrase still now commonly applied to accountants and teachers!)
He needed a ‘get rich quick’ scheme and his was a work of genius
He made down-payments on the seasonal use of every olive press in the regions of Miletus (once the greatest Greek city in the East) for which he negotiated a very low rent
The next years’ olive harvest turned out to be bountiful, and there was huge demand for olive presses across the regions
Thales released each of the olive press owners from their contracts, but on his terms, and built a substantial fortune for himself as part of the process. The Option Agreement was born
Option Agreements in UK real-estate planning are legal contracts between a landowner and a potential purchaser, typically a developer, granting the latter the right to purchase land within a specified timeframe
These agreements are particularly useful for developers who need time to secure planning permission or assemble multiple plots of land for larger projects
That way it’s possible to provide flexibility and security for both parties, allowing developers to plan and secure land for future projects, while giving landowners potential future sales on agreed terms
Option Agreements are just one method of land acquisition, there are several others, and our team of Chartered Tax Advisors are familiar with the tax treatment of them all
Book your FREE initial discussion on any aspect of UK property tax planning HERE
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