The Annual Tax on Enveloped Dwellings (ATED) came into effect from 1 April 2013. The tax applies to certain Non-Natural Persons (NNPs) that own interests in dwellings valued at more than £500,000. These provisions affect most companies, partnerships with company members and collective investment schemes. There is no ATED or ATED-related Capital Gains Tax payable if an individual owns a property directly, rather than through a company.
The main ATED reliefs are broadly where the property is:
Dwellings are revalued for ATED purposes every 5 years. The definition of the ‘dwelling’ includes the garden or grounds that go with the dwelling. There are also special rules where an NNP holds an interest in more than one dwelling such as a block of flats or where they own a dwelling and non-residential land.
For the period 1 April 2019 to 31 March 2020, ATED is chargeable on property valued at:
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