Second ATED deadline fast approaching

Our UK Director of Private Client Services talks through the latest HMRC deadline for UK property tax

The deadline for the submission of the second UK set of tax returns under the Annual Tax on Enveloped Dwellings (ATED) regime will soon be with us.

This tax is currently charged on UK residential properties valued at more than £2m that are owned by companies, collective investment schemes and some partnerships and not commercially let.  The tax is a fixed figure based upon the value of the property at 1 April 2012. It was introduced to catch those who may have avoided stamp duty.

The returns for 2014/15 are due to be submitted online to HM Revenue and Customs by 30 April 2014 and the tax then paid. The penalty for late returns is £100, plus £10 per day if it is more than three months late. If payment is late, the penalty is 5% of the tax due with further penalties arising if payment is delayed by more than six months

The first year of ATED (2013/14) has proved more lucrative for the government than they expected, so - unsurprisingly and as predicted - the Chancellor of the Exchequer in his 2014 budget announced that ATED will apply to more houses and flats. Enveloped dwellings valued at more than £1m will be caught from 1 April 2015 and such homes valued at more than £0.5m will fall into charge from 1 April 2016.

There are various reliefs from ATED and transitional arrangements relating to the lowering of the valuation limit.

TMF Group can help you to comply with ATED; please contact Vince Cheshire, Director of Private Client Services.

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