| The Chancellor announced an extension to the package of taxes that affect high value residential properties held by certain non-natural persons (eg companies). Originally, these taxes only applied to properties costing over £2m, this threshold will now be reduced to £500,000.
The lower threshold will affect the Stamp Duty Land Tax (SDLT) charge of 15%, the Annual Tax on Enveloped Dwellings (ATED) and the Capital Gains Tax (CGT) charge of 28% which applies to any gain on disposal. The threshold of £500,000 for SDLT purposes will apply to all transactions on or after 20 March 2014. Where contracts were entered into before that date the £2m threshold will continue to apply. The new bands for ATED purposes are being phased in with properties over £1m incurring a £7,000 charge from 1 April 2015 and properties over £500,000 incurring a charge of £3,500 from 1 April 2016. The extensions to the CGT charges will take effect from 6 April 2015 and 6 April 2016 for properties costing more than £1m and £500,000 respectively. |