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How to file your Annual Tax on Enveloped Dwellings | ATED Return

Published by Prasun Shrestha
Published Date: March 21, 2023

Annual Tax on Enveloped Dwelling (ATED) is the tax applied to UK residential properties owned by companies, partnership with corporate partners and other collective investment scheme whose total value is more than £500,000 per property.

If you own a UK residential property through a company or another type of corporate entity, you may be required to file an Annual Tax on Enveloped Dwellings (ATED) return with HMRC and pay any applicable taxes.

Filing the ATED Return: Deadlines

The ATED return is prepared till 31 March annually irrespective of the company's year-end. Unlike other tax returns ATED is forward-looking.

If the company is within the scope of ATED on 1 April, it is required to submit the ATED return and pay the tax owed. The deadline for which is April 30th of each year.

UKPA ATED Image

April 30th 2024 is the Deadline for ATED Filing.

You usually need to submit the return:

Return Submissions for

Deadline

New acquisition

within 30 days of acquisition, if it comes within the regime after 1 April

Newly built property

Within 90 days of

  • The property becoming dwelling for Council tax purpose, or
  • Its first occupancy

Whichever is earlier

Any other case

30th April

Steps for Filing your ATED Return

If you are required to file an ATED return, there are several steps you need to follow to ensure that your return is filed correctly and on time.

Step 1: Register for ATED

Register for Annual Tax on Enveloped Dwellings

Before you can file your ATED return, you must first register for ATED by completing an online form on the HMRC website.

You will need to provide information about the property and the entity that owns it, as well as the expected value of the property.

You must register for ATED within 30 days of acquiring the property or becoming subject to ATED for the first time.

Step 2: Determine the Value of the Property.

You have the option to determine the value of the property on your own or hire a professional valuer. It is imperative that the valuation is denominated in pounds sterling.

The valuation must reflect an open-market transaction between a willing buyer and a willing seller and must be a definite amount. If you do not possess the unencumbered freehold interest, the valuation may not be a vacant possession valuation.

The valuation date to be used depends on the period during which you owned the property. There are two types of valuation dates:

  • The initial valuation date
  • The revaluation date

The initial valuation date is 1 April 2012 for properties owned on or before that date, or the date you acquired the property if it was after 1 April 2012.

For all properties, there are fixed revaluation dates every five years after 1 April 2012, regardless of when the property was acquired.

Step 3: Calculate the Tax Owed.

The amount of tax you owe will depend on the value of the property and any applicable reliefs. The tax rates for 1 April 2024 to 31 March 2025 are as follows:

Property Value

Annual Charge

More than £500,000 up to £1 million

£4,400

More than £1 million up to £2 million

£9,000

More than £2 million up to £5 million

£30,550

More than £5 million up to £10 million

£71,500

More than £10 million up to £20 million

£143,550

More than £20 million

£287,500

If you are eligible for a relief or exemption, the amount of tax you owe may be reduced or eliminated. Some of the reliefs and exemptions available under ATED include:

  • Property rental business relief
  • Property development relief
  • Trading stock relief
  • Charity relief
  • Public body relief
  • Property occupied by employee’s relief.

Step 4: File your ATED Return and Pay any Tax Owed.

You can file your return online using the HMRC website, and you will need to provide details about the property, its value, and any applicable reliefs or exemptions.

You will also need to provide information about the entity that owns the property, such as its name, address, and registration number. Once you have submitted your return, you will be given a calculation of the tax owed. You can then pay the tax online or by bank transfer.

It is important to ensure that you file your return and pay any tax owed by the deadline to avoid penalties and interest charges. The deadline for filing and payment is April 30 of the relevant tax year, so for the 2023-24 tax year, the deadline is April 30, 2023.

How Our Accounting Services Can Help You Meet ATED Obligations

Filing your UK Annual Tax on Enveloped Dwellings (ATED) can be a complex process, but it is crucial to ensure that you comply with HM Revenue and Customs regulations. By understanding the ATED bands, the relevant deadlines, and the available reliefs, you can take steps to minimise your tax liability and avoid penalties.

As an accountant, we can provide valuable assistance to businesses with regards to filing their UK annual tax on Enveloped Dwellings (ATED). For more information, you can also drop your ATED related queries for which you can get information directly from the experts.

Do you have more queries?

We can help by providing advice on the applicable tax bands, reliefs, and deadlines, as well as assisting in the preparation and submission of the necessary tax forms. Our expertise can ensure that your ATED filing is accurate and timely, minimizing your tax liability and avoiding costly penalties. 

Prasun Shrestha
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