The annual tax on enveloped dwellings (ATED) filing deadline is often overlooked as it is generally due 30 days after the start of the new tax year. For 2018/19, the deadline for submitting an ATED return is 30 April 2018.
In a nutshell, a non-natural person owning an interest in a UK residential dwelling valued at more than £500k would fall within the ATED rules. A non-natural person includes a company, a partnership where at least one of the partners is a company or a collective investment scheme (please note that does not apply to a partnership or LLP where the members are all individuals).
Where an interest in residential dwellings is acquired after 1st April 2018, the deadline will be extended to 30 days after the date of the acquisition. For new builds, the deadline is 90 days from becoming a dwelling for Council Tax purposes or the date that it is first occupied, whichever is earlier.
The ATED charge is based on a banding system using the value of the property. It starts from £3,600 for the lowest band and increases to £226,950 for the highest band. Relief from the ATED charge is available if the residential dwelling is used for commercial purposes e.g. for property developers or for a property used for rental businesses. The relief must be claimed by filing the ATED relief return.
If the return (even to claim relief) is filed after the statutory deadline, a late filing penalty will be levied.
If you think you could be affected by ATED, please do not hesitate to contact us at DRG Chartered Accountants to talk to our team of tax specialists.
DISCLAIMER: This information is for guidance only, and professional advice should be obtained before acting on any information contained herein. We will not accept any responsibility for loss to any person as a result of action taken or refrained from in consequence of the contents of this publication.