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News – 16.04.25

Buzzacott advises Karnell Group AB (publ) on the acquisition of Warwick SASCo Ltd

Find out how Buzzacott advises Karnell Group AB (publ) on the acquisition of Warwick SASCo Ltd … Read more

Insight – 01.05.25

Transaction readiness – preparing for an exit starts years before sale

One of the key things that impacts transaction outcomes is the preparedness of a business ahead of exit. … Read more

Upcoming event – 14.05.25

Webinar: The new Form PF amendments - June 2025

Book for our Form PF webinar … Read more

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enquiries@buzzacott.co.uk T +44 (0)20 7556 1200

Last updated: 10 Apr 2025

Imminent deadline for 2025/26 Annual Tax on enveloped dwellings compliance

If your company holds residential property with a market value in excess of £500,000 you need to submit your 2025/26 Annual Tax on Enveloped Dwellings (ATED) return or relief declaration (and pay any ATED charges) on or before 30 April 2025.

What is ATED?

Annual Tax on Enveloped Dwellings was introduced in the 2013 Finance Act as a measure to deter the holding of high-value residential properties within a corporate structure (e.g. a UK limited company). It works by imposing a fixed annual charge based on the value of the property held.

The ATED tax year runs from 1 April to 31 March and, unlike other UK tax regimes, requires returns to be submitted at the start of the annual period rather than the end. Failure to submit an ATED return on time will result in penalties and interest charges.

About the authors

Jessica Beere

+44 (0)20 7556 1282
beerej@buzzacott.co.uk
LinkedIn

Megan Wilson

+44 (0)20 3972 6628
wilsonm@buzzacott.co.uk
LinkedIn

What is ATED?

2023/24 compliance

2025/26 Compliance

For the period 1 April 2025 to 31 March 2026, you must complete the ATED annual compliance documentation and pay any ATED charge due by 30 April 2025. For this compliance season, the value of the property for ATED purposes is the market value as at 1 April 2022, as was the case for the 2023/24 and 2024/25 ATED periods.

Valuation

Whilst a formal valuation is not mandatory, we recommend obtaining one for ATED purposes where the property is in an area with high price fluctuations to support any returns made.

In most cases, the 1 April 2022 valuation would have been obtained for the 2023/24 returns. However, for properties acquired after this date, the value at acquisition is used to determine which charge applies.

The next revaluation date is 5 April 2027.

2025/26 Charges

The ATED charges in each band increase with inflation each year, and the charges for the period 1 April 2025 to 31 March 2026 are as follows:

Property value	Annual charge
More than £500,000 up to £1million	£4,450
More than £1million up to £2million	£9,150
More than £2million up to £5million	£31,050
More than £5million up to £10million	£72,700
More than £10million up to £20million	£145,950
More than £20million	£292,350

Acquiring a new property through a corporate structure/envelope

ATED Reliefs

Certain exemptions are available against the charges above, with the most common relief being for property businesses. Certain properties used in a commercial venture (e.g. hotels, student accommodation) fall outside the scope of ATED entirely.

Set conditions must be satisfied for all available reliefs, and a relief declaration return is still required annually, even where no tax is due.

Therefore, it is crucial that you review your company’s ATED obligations as we approach the deadline, to avoid penalties for non-compliance.

Get in touch

If you are unsure if you need to submit an ATED Return, ATED Relief declaration, or have recently purchased UK residential property via a corporate structure please do not hesitate to get in touch and our experts would be happy to help.