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London Bears Brunt Of Tax On Enveloped Dwellings

by Robert Lee, Tax-News.com, London

10 November 2014


Research from UHY Hacker Young has shown that 89 percent of HM Revenue and Customs's (HMRC's) total take from the new Annual Tax on Enveloped Dwellings has been collected from London properties.

The ATED came into force on April 1, 2013. It is payable by companies that own high value residential property in the UK. Budget 2014 introduced a reduction in the ATED valuation threshold from GBP2m (USD3.2m) to GBP500,000, to be staggered over two years.

According to UHY Hacker Young, HMRC raised GBP100m from the tax in 2013-14, and London contributed GBP89m of this figure.

85 percent of nationwide receipts came from just four London boroughs. Westminster contributed more than half of the national total, with property owners paying GBP52m in ATED. GBP28m was raised on properties in Kensington and Chelsea, GBP3m in Camden, and GBP2m in Barnet.

Mark Giddens, Tax Partner at UHY Hacker Young, said: "Once again, London's wealthy expatriate population is bearing the brunt of the Treasury's innovation in taxes. Having just recently been hit by an increase in the non-dom tax levy, foreign High Net Worths are beginning to feel targeted."

He concluded: "ATED is to be extended to lower value properties, but as things stand HMRC's relatively low receipts raise the question of whether it is worth the time, resources, and negative publicity that the tax brings."

TAGS: tax | investment | real-estate | United Kingdom | tax thresholds | tax authority | tax rates | HM Revenue and Customs (HMRC) | revenue statistics | tax reform | HM Revenue and Customs (HMRC) | Expats | Investment | Property Investment | Invest | Investment

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