The Annual Tax on Enveloped Dwellings (ATED) must be paid by corporate owners of UK residential properties worth over £500,000, if an exemption or relief from ATED has not been claimed for the property. The amount due per property varies from £3,500 to £220,350 per year (2017/18 rates).
Where an ATED payment is due, an ATED return for the property must be submitted to HMRC by 30 April within the chargeable year; by 30 April 2017 for 2017/18. The ATED return can be filed online or on paper, but the online return for 2017/18 can’t be submitted before 1 April 2017.
When the property is acquired during the year, the ATED must be paid within 30 days of the acquisition date. Where the property is a new build, the ATED must be paid within 90 days of the date the local council issues a completion notice. If the property is occupied as a residence before that date, the ATED return is due 90 days after the occupation date. Council tax is due in addition to the ATED.
If the property qualifies for relief or exemption from ATED, that relief must be claimed on an ATED relief declaration form. There is a separate ATED declaration relief form for each type of relief, such as property trading, development or letting. The ATED relief declaration form must also be submitted by 30 April each year.
If your company owns residential property, you need to be aware of your ATED obligations. Failure to submit an ATED form, or ATED relief declaration on time, will trigger significant penalties. HMRC can easily check which companies own residential properties by searching the Land Registry.