UK: Company-owned residential properties inadvertently subject to land tax

UK: Company-owned properties subject to land tax

Officials with HM Revenue & Customs are exploring solutions to alleviate instances when businesses inadvertently come within the scope of the annual tax on enveloped dwellings (ATED) and imposition of the 15% stamp duty land tax (SDLT). Relief from the ATED is turning out to be potentially insufficient for certain businesses because they are inadvertently coming within the tax charge in a limited number of cases.


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Broadly, issues in the following situations have been identified and are currently being consulted on informally by HMRC:

  • Companies holding interests in residential property under equity release schemes  
  • Management companies holding an interest over a building consisting of apartments subject to long leases over those apartments held by their members (individual owner occupiers) 
  • Companies that hold residential property for investment and permit a caretaker (or similar employee) to occupy an apartment

Read an August 2015 report prepared by the KPMG member firm in the UK: Weekly Tax Matters

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