15th April 2026
Companies holding residential property should be aware of their obligations under the Annual Tax on Enveloped Dwellings (ATED) regime, particularly as key deadlines and valuation dates approach.
ATED applies to companies that own UK residential property valued at £500,000 or more. Returns must be submitted annually, with the filing window running from 1 April to 30 April each year.
Reliefs still require a return
While there are a number of reliefs available, including where a property is let commercially or held as part of a development business, these do not remove the requirement to file. Even where no tax is due, an ATED return must still be submitted to claim the relevant relief.
Failure to file can result in penalties of up to £1,600 per return, making it essential that companies understand their obligations.
The importance of the 2027 valuation
ATED is based on the open market value of a property at fixed valuation dates. The next key date is 1 April 2027, which will determine whether a property falls within the regime for the following five-year period.
If a property is valued at £500,000 or more on that date, ATED returns will be required annually until 2032, with any applicable reliefs claimed each year.
It’s important to plan ahead, as the timeframe is tight, valuations must be established as at 1 April 2027, and the return submitted by 30 April 2027.
Below the threshold
If the property is valued at £499,999 or less at the 2027 valuation date, no ATED returns will be required for the next five years, regardless of any subsequent increase in value. The next review point would then be 1 April 2032.
Acquisitions during the cycle
For properties acquired between valuation dates, different rules apply. If a company purchases a residential property for more than £500,000, an ATED return must be submitted within 30 days of acquisition, followed by annual returns each April.
Planning ahead
Although the next valuation date may seem some time away, early preparation is advisable. Understanding whether your property is likely to fall within the ATED regime can help avoid last-minute valuations, missed deadlines, and unnecessary penalties.
