Annual tax on enveloped dwellings – there's no time to lose

The Government issued the final version of the return for the new annual tax on enveloped dwellings (ATED) at the end of July 2013. This was followed by recent guidance which gives a clearer view of how ATED forms will need to be completed.  

The new tax applies to residential properties worth over £2m which are held by companies, partnerships with a company partner or collective investment schemes; i.e. not those owned by private individuals.  

Additional reliefs and submitting a return 

Additional reliefs from the tax were introduced following consultation. But, even if a relief applies, you’re still required to submit a return annually in respect of the relevant property. So, if you’re a property rental business or providing employee accommodation, what will this mean for you? It may mean that you’ll incur compliance costs in filing the relevant returns even though no tax is due. But on the positive side, you can make just one return for several properties if you’re claiming the same relief for all of those properties. 

Filing your forms on time

If you fall into one of these categories, you’ll need to have filed your form between 1 August and 1 October 2013, which doesn’t give much time to complete and submit returns. The first return is for the year starting on 1 April 2013 and payment for the year is due by 31 October 2013.

To find out more

You can find out more about ATED and the taxation of high-value property on our website, with a video from Leonie Kerswill, Partner in our Private Client team. Click here to find out more.

Paul Emery is a Director in our Real Estate practice. If you'd like to find out more about ATED, you can contact him on 020 721 33071 or by email at [email protected].