Annual Tax on Enveloped Dwellings

The Annual Tax on Enveloped Dwellings (“ATED”) is chargeable, as the name suggests, annually on dwellings that are owned by companies, partnerships (with at least one corporate partner) or collective investment schemes.

For the ATED charge to apply the owner must have a chargeable interest in a residential property with a value of at least £500,000.

The charge to ATED for 2017/18 is as follows:

Certain types of residential property are excluded from the charge, including hotels, hospitals, care homes, some types of student accommodation, prisons and boarding schools.

Additionally, under certain circumstances relief can be claimed whereby the ATED charge is either reduced or no longer payable, for example, where properties are rented out on a commercial basis.

ATED charges need to be carefully considered when investors are deciding on how property in the UK should be owned.

If you would like to speak to someone regarding the ATED in more detail, then please contact us.