Autumn Statement ATED

Autumn Statement ATED Annual Tax on Enveloped Dwellings Increase.

Transcipt:

“Hello there, December 3, 2014, it's autumn statement day, chancellor has just recently finished his speech and I've been analysing the autumn pre-budget statement and subject for this video is ATED, the annualised tax on enveloped dwellings.

Now in very simplistic terms or I will say to you is: for most people that this doesn't affect us. We own our homes directly and we pay our stamp duty which, I’ll come onto stamp duty in a separate video but we pay our stamp duty when we buy our home and pay our council tax etc.

Now what ATED is, is a tax where properties are owned by envelopes, an annualised tax on enveloped dwellings. So, for example the property, the residential property, is owned by a company, an offshore company, an onshore company, whatever it might be, a trust.  So it’s in a wrapper, it’s inside a wrapper and the reason for doing this is, what people are doing here is, particularly large wealthy, wealthy clients and offshore clients and international clients is they own property inside a company which then means that they ever want to sell the property the property doesn't have to be sold by the company, the wrapper [as the shares in the company are sold].  So stamp duty is not payable.  So the government announced this tax, a yearly tax on enveloped dwellings to penalise people who buy companies as part of a corporate structure. Now what the chancellor has just announced in his budget is whilst all of the basic tax levels remain the same in terms of thresholds, whether you properties worth £0.5million or £1 million or £2 million or £5 million or £10 million etc, but what he has announced is he's going to increase the rate of tax for properties worth £2 million or more, he is increasing the rate of tax by double the rate of inflation. So again, starting to hit quite hard those people who still feel they can afford to own a on high value property inside a corporate structure. So that’s some changes there as part of autumn statement 2014, December 2014. Annualised tax on enveloped dwellings is going up. Thanks very much for watching.”