HMRC has confirmed that the use of a residential property under the ‘Homes for Ukraine’ Scheme should not have any adverse SDLT or ATED implications for companies.
SDLT
Where a company (or other 'non-natural person') buys a residential property costing more than £500k, SDLT is charged on the full amount at the rate of 15%. There is a relief from the 15% rate where the property will be used for certain purposes, eg within a property rental business.
There was some concern that the use of a residential property to house refugees under the Scheme may have resulted in the withdrawal of the reliefs from the 15% rate of SDLT. HMRC's announcement confirms that the reliefs should continue to be available.
ATED
Where a company holds such a property, it may also be subject to an annual charge under the ATED rules, but there are again certain reliefs (eg where the property is let to a third party on a commercial basis).
HMRC has confirmed that relief from ATED should also be available while a residential property is being used under the ‘Homes for Ukraine’ Scheme.
For further information or assistance, please contact Malcolm Pengelly.
Would you like to receive more alerts like these?
This article has previously been sent to subscribers to our regular email updates specifically for tax advisers. The updates cover important topical issues affecting tax, including the latest news, common issues that are raised on our telephone helpline (Taxline), and news of our seminars and webinars.
Sign up to this free service to ensure that you receive each ezine as soon as it is published.
CHRIS HOLMES ►
Tax Director
Subscribe to receive the latest BDO News and Insights
Please fill out the following form to access the download.