Stamp Duty Land Tax on enveloped residential property over £500k
Tue 01 Apr 2014
The 15% SDLT rate was extended to acquisitions of residential property worth over £500k completed on or after 20 March 2014 by non-natural persons, i.e. companies, partnerships including companies and collective investment schemes that are subject to ATED. This surprise measure will have caught many property purchasers unawares but transitional provisions will exempt contracts entered into before 20 March from the increased rate.
The transitional provisions will not apply where:
The same reliefs apply to the higher rate of SDLT as to ATED.
Until the introduction of the annual tax on enveloped dwellings (ATED) there were tax advantages in having high value residential properties owned by a company rather than personally. Since 6 April 2013 ATED imposes an annual “charge” of between £15,000 and £140,000 on companies and other non-individual owners of UK dwellings with a value in […]
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It was a quiet Budget on the Stamp Duty Land Tax (‘SDLT’) front with the only announcement being the welcome delay for a year of the reduction in the filing and payment window until 2018/19. The proposal to reduce the return filing and payment window from 30 days to 14 days was announced in the […]
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Following the 2014 Budget the ATED threshold is to be reduced to: £1m (£7k charge on properties £1m to £2m) from 1 April 2015; and £500k (£3.5k charge on properties £500k to £1m) from 1 April 2016. These changes increase substantially the number of situations ATED will affect, including those where reliefs apply.
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The Government has announced proposals to extend the scope of reliefs from the higher 15% of stamp duty land tax (SDLT) and the annual tax on enveloped dwellings (ATED) to cover residential property held for the purposes of an Equity Release Scheme or Home Reversion Plan, property occupied by employees, or acquired for demolition or […]
The annual tax on enveloped dwellings (ATED) has been with us for five years and the first automatic revaluation is now about to take effect: for 2018/19 ATED on properties already subject to the tax will be charged on the basis of a property’s value as on 1 April 2017unless the property was acquired at […]
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As the tax net is cast ever wider to increase revenues without “increasing taxes”, the annual tax on enveloped dwellings (ATED) is to be extended to properties valued over £500k and up to £1m from 1 April 2016, with an annual charge of £3,500. For this purpose, the value of the property is that at […]
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The government has now finalised its proposals for the introduction of a 3% surcharge for purchases of additional homes and buy-to-let properties by individuals and for any purchase of a dwelling by a company or other non-natural person. However, there is unwelcome news in that the proposed exemption for large scale investors will no longer […]
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ATED amounts 2014/15 The value bands for ATED will remain the same in 2014/15 but the amounts of ATED payable on each band are increased as follows: New ATED bands in 2015/16 and 2016/17 From 1 April 2015 a new band will come into effect for properties with a value over £1million and up to […]
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In a logical move the charging structure for non-residential property has now been brought into line with that for residential property by abolishing the slab system which applied a single rate to the entire transaction value. This brings the method in which stamp duty land tax (‘SDLT’) is applied to property transactions in England and […]
An unheralded effect of the annual tax on enveloped dwellings (ATED) changing to its new online system has just emerged and may cause difficulties for taxpayers paying tax when or before they submit their returns if not handled properly. Remember, the deadline for filing ATED returns and making payments is 30 April Like any tax […]
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For companies, the preparation and filing of the annual corporation tax return is usually what springs to mind when the word tax is mentioned. However, the Annual Tax on Enveloped Dwellings (‘ATED’) is often forgotten and can catch out companies that hold UK residential property. What is ATED? ATED is an annual tax that is […]
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From April 2018, Land Transaction Tax (LTT) will replace UK Stamp Duty Land Tax (SDLT) in Wales. A draft copy of the legislation (Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Bill) has now been published. It is intended to be broadly consistent with SDLT, preserving the underlying structure and mirroring key elements such […]
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Although not mentioned in the Chancellors Speech, the Annual Tax on Enveloped Dwellings (‘ATED’) charges that will apply for 2017/18 have been increased slightly from those for 2016/17 for all bands except the lowest band. Somewhat surprisingly, for a tax which was introduced to deter residential property from being held in a corporate or other […]
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Chartridge Developments Ltd (Chartridge), [2016] UKFTT 766 (TC), has had penalties for failure to submit its ATED returns on time significantly reduced due to errors on the part of HMRC but other companies may not be so lucky. The case highlights the importance of having robust systems to ensure that all compliance obligations are met […]
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