The current legislation in respect of ATED and the 15% rate of SDLT as outlined in FA 2003 and FA 2013 provides several reliefs.
The government have announced that legislation will be introduced to amend the current legislation within FA 2003 and 2013 to give provide reliefs for high value property from both the ATED charges and the 15% rate of SDLT. These new reliefs will be effective from 1 April 2016.
There are three new reliefs:
- Properties with multiple occupancy, for example a block of flats, may contain one residence which is occupied by an employee or caretaker appointed by the owner of the whole property. Where this is the case that residency will be relieved from both the ATED charges and the 15% rate of SDLT.
- Relief will also be available from both ATED charges and the 15% rate of SDLT if the sole reason for owning a property is due to an Equity Release Scheme (specifically a ‘home reversion plan’). The Equity Release Scheme will, however, have to be regulated by the Financial Conduct Authority.
Relief will be available from the 15% rate of SDLT for properties bought by a trading company to be either converted into a non-residential use or for demolition. Releif will be withdrawn if the property is held for another purpose within 3 years of acquisition.