Are you ready for the Annual Tax on Enveloped Dwellings deadline?

The Annual Tax on Enveloped Dwellings (ATED) remains a compliance obligation for companies, partnerships with a corporate member and collective investment schemes who hold UK residential property. With the 2026/27 chargeable period now underway, it is important to ensure that returns are submitted ahead of the 30 April 2026 deadline.

What is ATED and who does it apply to?

ATED is an annual tax charge on UK residential property valued at more than £500,000 when it is held within a corporate structure. In many cases, an ATED return is still required even where reliefs are available and no tax is ultimately payable, making compliance essential regardless of liability.

ATED does not apply to properties owned by individuals in their personal capacity. It is specifically targeted at residential property held within corporate envelopes.

What is the current revaluation position?

ATED operates on a five-year revaluation cycle, and we are currently within the period based on the 1 April 2022 valuation date. Properties owned at that date must be revalued as at 1 April 2022, while those properties acquired after this date should be valued at acquisition. This valuation underpins the ATED banding and therefore directly impacts the level of the ATED charge.

What are the ATED charges for 2026/27?

For the period from 1 April 2026 to 31 March 2027, the annual charge ranges from £4,600 for properties valued between £500,000 and £1 million, up to £303,450 for properties valued above £20 million. Given the significant increases between the bands, ensuring that an accurate and supportable valuation is particularly important, as an incorrect valuation may lead to HM Revenue and Customs enquiries.

Property value Annual charge 2026/2027

When do you need to file?

ATED returns must be submitted by 30 April 2026 for the 2026/27 tax year, with any annual charge payable by the same date. ATED returns are also required when a property first comes within the scope of ATED or where reliefs are being claimed. If the property is a new acquisition, an ATED return must be completed within 30 days of acquiring the property.

What counts as a dwelling?

A property will generally be considered a dwelling if it is used, or could be used, as a residence. This includes houses and flats, along with gardens and grounds. Certain property types, such as hotels, student accommodation and care homes, are excluded from the charge, although mixed-use properties can require more detailed consideration.

Are there reliefs?

A number of reliefs are available, particularly where properties are commercially let, held for development or used for certain business purposes. However, these reliefs are not automatic and must be claimed through the ATED return.

What are the risks of non-compliance?

Failure to meet ATED obligations can lead to penalties for late filing and interest charges on unpaid tax charge. Where a taxpayer disagrees with an HMRC decision, there is usually a 30-day window to submit an appeal.

How can Moore South help?

Moore South can support the ATED return preparation and identifying available reliefs, helping to ensure compliance while managing exposure efficiently.

If you hold UK residential property within a corporate structure, now is the time to review your ATED position ahead of the deadline.