Mark McLaughlin looks at relief from the annual tax on enveloped dwellings for property development trades.
Companies holding residential property in the UK need to be wary of the annual tax on enveloped dwellings (ATED) (FA 2013, Pt 3, Schs 33-35).
ATED is charged annually on companies (and other ‘non-natural persons’) that hold an interest in a UK residential dwelling (a ‘single-dwelling interest’) worth more than a statutory threshold. ATED may be due if the UK residential property is valued at more than £500,000.
That’s a relief!
However, there are various reliefs and exemptions from ATED. For example, there is relief where the single-dwelling interest is used as a source of rents from a property rental business run commercially and with a view to profit.
In addition, relief from ATED may be