Annual Tax on Enveloped Dwellings (ATED) is a tax that applies to companies and other non-individual owners of UK residential properties worth more than £500,000. The amount payable depends on the property’s value, but there are reliefs available that can reduce or remove the tax.

Who can claim relief?

You may be able to claim ATED relief if the property is:

• Rented out commercially to someone who is not connected to the owner
• Never used or available for use by the owner or anyone linked to them

If this applies, the relief must be claimed through an ATED return.

Key Deadlines:

• ATED is paid for tax years running from 1 April to 31 March.
• The return for 1 April 2025 – 31 March 2026 must be filed between 1 April 2025 and 30 April 2025.

HMRC’s review of ATED claims

In the coming months, HMRC will contact companies that:

• Own UK residential property worth over £500,000
• Declared no profits in their Corporation Tax returns between 2017 and 2020
• Have not filed an ATED return or have claimed relief

HMRC may challenge these relief claims if a company has not been run as a commercial business. Companies receiving a letter will need to respond within 40 days with further details, disclosures, or any missing returns.

If there’s no response, HMRC may issue a tax bill and penalties.

Need help?

If you own property through a company and want to make sure your ATED position is correct, get in touch. We can help you review your situation and avoid potential issues with HMRC.