Non-resident Company Landlords

  • Annual Tax on Enveloped Dwellings (ATED)
  • Stamp Duty Land Tax (SDLT)
  • Capital Gains Tax (CGT)
  • Income Tax

ATED (Annual Tax on Enveloped Dwellings)

This was originally a tax or charge levied on residential property held by “non-natural persons” (including companies). It levied an annual charge at increasing rates on property worth more than £2m. This has now been changed and the bands extended to include property worth more than £500,000. Properties are revalued every five years. The most recent valuation date is 5th April 2017 and ATED will apply from 5th April 2018 to all properties worth more that £500,000 as at 5th April 2017. See Rates and Tables. If you let your property you may claim relief from the charge. (There are a few other reliefs too). But you have to claim the relief, it isn’t given automatically. This means completing an additional return each year, and having the property valued every fifth year.

SDLT (Stamp Duty Land Tax)

The 15% rate of Stamp Duty Land Tax was introduced at the same time as the ATED. This too has now been extended and so the 15% rate will also apply to company (and other non-natural person) purchases in the range £1m to £2m from 6th April 2015 and purchases in the range £500,000 to £1m from 6th April 2016.

In addition the purchase by a company will attract 3% uplift in SDLT on all purchases of buy to let property over £40,000.

CGT (Capital Gains Tax)

For those of you who hold your property through the medium of a non-UK company you are now caught up in the extension of CGT to all non-residents (whether companies or individuals). Gains accruing after April 2015 on disposals after April 2015 are now subject to CGT. The rate  is 20%. But remember it is only the increase in value from April 2015 to the date of sale that is taxed. Gains on disposals of UK property made by non-residents before April 2015 remain generally outside the scope of UK taxation.

The CGT rate for gains accruing while ATED was levied is 28%.

© Landlords Tax Services Ltd 2016 All Rights Reserved - In an article such as the one on this page we can only give brief general guidance and cannot cover all situations. This guidance may not cover all your personal circumstances and so you should not rely on it. Before taking action or not, always do your own specific research and seek appropriate professional advice which takes into account your personal circumstances, with the full facts of the case and all documents to hand. Neither Maurice Patry F.C.A. nor Landlords Tax Services Ltd can be held responsible for the consequences of any action or the consequences of deciding not to act.