If you are buying UK property, shares or a business, you may be liable for stamp taxes including stamp duty land tax (SDLT). In addition, if you own residential property in a company valued in excess of £500,000 you may be subject to the annual tax on enveloped dwellings (ATED) charge.

Stamp taxes can be notoriously complex, and often forgotten, but they can represent a significant cost.

How can we help you?

  • Review property transactions to determine whether the stamp duty land tax (SDLT) liability can be reduced
  • Advise on ATED and help with annual reporting
  • Advise on other tax implications of the acquisition of property or land.
  • Obtaining clearance from HMRC before entering into a transaction where appropriate
  • Help you to meet your compliance obligations.

 

What is ATED?

A company or other non-natural person holding a residential property with a value in excess of £500,000 is subject to the annual tax on enveloped dwellings (ATED) rules.

2022 was a revaluation year requiring properties to be revalued as at 1 April 2022 to determine whether the rules apply with effect from 1 April 2023. As a result many more companies could find themselves within the regime for the 2023/24 tax year if they now breach the £500,000 threshold following revaluation.  Not all properties are subject to the charge as certain exemptions and reliefs apply but a return may still need to be filed, with penalties applying for failure to do so. 

SDLT Case Study

SDLT advice on the 3% surcharge for additional residential properties

Background: We were approached for SDLT advice in connection with a new property purchase. Our client owned a property personally which they had lived in with their partner for many years. The partner owned a rental flat solely in their name.

The couple wished to jointly purchase a new property to live in and sell the house they were currently living in. This, however, would have triggered an additional 3% SDLT liability on the entire property value by virtue of the partner not having a share in the main residence and owning a separate property.

How we helped: Without our help, additional SDLT of £9,000 would have been due under the new 3% surcharge rules. As a result of our advice, the client was able to change their position, saving them from paying this additional SDLT.

 

For individual help and advice, please contact the team 

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Content image: /uploads/team/unknown.jpg Nick Haines
Nick Haines
Partner, Tax and Property
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