UK ATED Annual Tax on Enveloped Dwellings 2026/27
ATED 2026/27: six charges from £4,600 to £303,450 on company-held UK homes over £500,000, reliefs, 30 April returns, revaluation and the 17% SDLT rate.
2026/27 ATED charges (1 April 2026 to 31 March 2027)
| Property value | Annual ATED charge |
|---|---|
| More than £500,000 up to £1,000,000 | £4,600 |
| More than £1,000,000 up to £2,000,000 | £9,450 |
| More than £2,000,000 up to £5,000,000 | £32,200 |
| More than £5,000,000 up to £10,000,000 | £75,450 |
| More than £10,000,000 up to £20,000,000 | £151,450 |
| More than £20,000,000 | £303,450 |
ATED applies across the UK. The 17% SDLT rate mentioned in the FAQ applies in England and Northern Ireland only.
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Frequently asked questions
What is ATED?
The Annual Tax on Enveloped Dwellings is a yearly charge on a UK dwelling valued at more than £500,000 that is owned wholly or partly by a company, a partnership with a company as a partner, or a collective investment scheme (Finance Act 2013 Part 3). Individuals are not within it. The chargeable period runs from 1 April to 31 March. Many owners pay nothing because a relief applies, but the relief must be claimed on a return.
What are the ATED bands for 2026/27?
For 1 April 2026 to 31 March 2027: more than £500,000 up to £1 million, £4,600; up to £2 million, £9,450; up to £5 million, £32,200; up to £10 million, £75,450; up to £20 million, £151,450; more than £20 million, £303,450. The whole charge for the band applies; it is not sliced. The amounts are uprated each year by September CPI (FA 2013 s.101). Owning the property for part of the year, or claiming relief for part of it, reduces the charge proportionately.
What reliefs are available from ATED?
Reliefs in FA 2013 ss.133-150 cover a dwelling: let commercially to an unconnected person (s.133); open to the public for at least 28 days a year (s.137); held by a property developer for development and resale (s.138) or by a property trader as stock (s.141); acquired by a financial institution in the course of lending (s.143); acquired under a regulated home reversion plan (s.144A); used to house qualifying employees of a trade (s.145); a farmhouse for a farm worker (s.148); or owned by a social housing provider (s.150). Rental relief is not available if anyone connected with the owner occupies, or is able to occupy, the dwelling at any time.
When must I file ATED-1 return?
By 30 April for a property in the scope of ATED on 1 April, or within 30 days of acquisition if it comes into scope later. For a newly built property the deadline is 90 days from the earlier of it becoming a dwelling for Council Tax purposes or being first occupied. Payment is due by the same date. Where every property is covered by the same relief, one Relief Declaration Return can cover them. Returns are filed through the ATED online service.
How does property valuation work for ATED?
Properties are revalued every 5 years from 1 April 2012. For the 5 chargeable periods from 1 April 2023, a property owned on or before 1 April 2022 is valued at 1 April 2022; a property acquired after that date is valued at the acquisition date. The value is open market value. If you think the value is within 10% of a band threshold, you can ask HMRC for a pre-return banding check. An incorrect value can attract an inaccuracy penalty.
How do ATED and the 17 per cent SDLT rate interact?
In England and Northern Ireland, a company, a partnership with a company partner or a collective investment scheme buying a residential property for more than £500,000 pays SDLT at 17% (from 31 October 2024; previously 15%). A non-UK resident buyer pays a further 2% surcharge on top. Reliefs from the 17% rate broadly mirror the ATED reliefs: property rental businesses, developers and traders, properties open to the public, financial institutions, employee occupation, farmhouses and qualifying housing co-operatives. Where relief applies, the company still pays SDLT including the 5% higher rates for additional dwellings. Scotland (LBTT) and Wales (LTT) have their own rules.
What are the ATED penalties for non-compliance?
For a late return: £100 the day after the deadline; £10 a day for up to 90 days once the return is 3 months late; then the higher of £300 or 5% of the tax at 6 months, and again at 12 months, with a higher percentage possible after 12 months for deliberate behaviour. On a £9,450 charge filed 12 months late that totals £1,945, before late payment penalties and interest. Inaccurate returns attract penalties under Finance Act 2007 Sch 24: up to 30% of the extra tax if careless, 70% if deliberate and 100% if deliberate and concealed, reduced for disclosure.
When does ATED NOT apply?
ATED does not apply to a dwelling worth £500,000 or less, to property owned by individuals, to partnerships with no company partner, or to buildings that are not dwellings (hotels, guest houses, boarding school accommodation, hospitals, student halls, military accommodation, care homes and prisons are listed by HMRC as not dwellings). Exempt bodies, such as charitable companies using the dwelling for charitable purposes, public bodies and bodies established for national purposes, do not need to file at all.
How does ATED interact with non-residence?
ATED depends on where the property is, not where the company is resident: a non-UK company owning a UK dwelling worth more than £500,000 is within the charge. When it sells, a non-UK company pays Corporation Tax on the gain. Separately, interests in overseas companies whose value comes from UK residential property are within the scope of Inheritance Tax under Inheritance Tax Act 1984 Schedule A1, so an offshore company no longer takes a UK home outside Inheritance Tax.
How do I close down an ATED structure?
The usual routes are a sale of the property to a third party, a transfer of the property out to the shareholders, or a liquidation. Each can trigger Corporation Tax on the company's gain, SDLT for the person acquiring the property, and tax for the shareholders on what they receive. A final or amended ATED return is needed for the part of the year the company held the property. Take advice on the whole sequence before acting.