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Enveloped dwellings tax among latest FB 2013 updates

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A Public Bill Committee has agreed a group of amendments to clause 54 and Sch 22 (Employee shareholder shares).

In addition, a Public Bill Committee has agreed a group of amendments to the new annual tax on enveloped dwellings (ATED) provisions. One set of amendments widens the exclusions from the rules treating separate interests in a dwelling as a single interest where they are held by connected persons. Another set exempts charitable companies from ATED provided no arrangements exist for a donor to occupy the property on terms related to the gift. A number of other clauses and schedules were agreed without amendment.

The government tabled a group of amendments to ‘ordinary residence’ in Sch 42. These correct certain anomalies concerning the exemption for termination payments and individuals who became non-resident between 2009/10 and 2012/13. The government also tabled a group of amendments to the statutory residence test in Sch 43. These include a significant relaxation to the fourth automatic UK test in paragraph 10 and changes to the split-year treatment in Part 3.

Further government proposals include amendments to vulnerable beneficiary trusts in Sch 42. These include changes to ensure that: the definition of ‘disabled person’ applies as widely as intended; interest in possession trusts are included for IHT purposes; and grandfathered rights are preserved where a codicil or new will is involved.