Complying with ATED Charge for High-Value Properties & Tax Advisory Partnership

Annual Tax on Enveloped Dwellings (ATED)

The Annual Tax on Enveloped Dwellings (ATED) is a yearly tax that applies to UK residential property valued above £500,000 when it is owned by a company, a partnership with a corporate member, or a collective investment scheme. These ownership structures are known as non‑natural persons.

ATED continues to apply from 1 April each year, with charges indexed annually.

Who ATED Applies To

ATED is due when:

A UK residential property is valued at more than £500,000
The property is owned by a non‑natural person
No reliefs or exemptions apply

Certain property types — such as hotels, guest houses, care homes, and purpose‑built student accommodation — are not treated as dwellings for ATED purposes.

Filing and Payment Deadlines

For each chargeable period (1 April to 31 March):

ATED returns and payments are normally due by 30 April at the start of the period.
- Example: For the 2025–26 period (1 April 2025 to 31 March 2026), the deadline is 30 April 2025.

Different rules apply if a property is acquired, disposed of, or newly falls within a charge band part‑way through the year. Late filing or late payment will trigger HMRC penalties and interest.

ATED Charge Rates (2025–26)

For the 2025–26 chargeable period, the annual ATED charges are:

£4,450 for properties valued between £500,000 and £1 million
£9,150 for properties valued between £1 million and £2 million
£31,050 for properties valued between £2 million and £5 million
£72,700 for properties valued between £5 million and £10 million
£145,950 for properties valued between £10 million and £20 million
£292,350 for properties valued above £20 million

These rates are updated annually in line with inflation.

Reliefs and Exemptions

A number of reliefs may reduce the ATED charge to nil, including:

Property rental businesses (commercial letting to third parties)
Property development
Property trading
Dwellings open to the public
Farmhouses meeting specific criteria

Even when a relief applies, a Relief Declaration Return must still be submitted.

Property Valuation Requirements

Properties must be revalued for ATED every five years.

The most recent revaluation date was 1 April 2022.
If the property was acquired after 1 April 2022, the acquisition date becomes the valuation date.
Valuation is based on self‑assessment, but professional valuations are strongly recommended.

How We Can Help

We support clients with all aspects of ATED compliance and planning, including: