Q&As

Does annual tax on enveloped dwellings apply to a limited company housebuilder that acquires existing dwellings for conversion or demolition and re-build?

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Published on LexisPSL on 21/03/2019

The following Tax Q&A provides comprehensive and up to date legal information covering:

  • Does annual tax on enveloped dwellings apply to a limited company housebuilder that acquires existing dwellings for conversion or demolition and re-build?

Does annual tax on enveloped dwellings apply to a limited company housebuilder that acquires existing dwellings for conversion or demolition and re-build?

Annual tax on enveloped dwellings (ATED) applies to high-value UK residential property owned on, or acquired after 1 April 2013, by non-natural persons (NNP). ATED is an annual tax and is charged in respect of chargeable periods running from 1 April to 31 March (the 'chargeable period') starting with the period 1 April 2013 to 31 March 2014. ATED applies where there is a chargeable interest which:

  1. is a single-dwelling interest situated in the UK

  2. has a taxable value of £500,000 or above, and

  3. is owned, completely or partly, by a NNP

For further details of when ATED applies, see Practice Note: Annual tax on enveloped dwellings (ATED)—the basics.

Relief from ATED is available where a property is held by a property developer, defined as a person carrying on a property trade, and the property interest is held with the

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