Companies owning residential properties must consider whether they fall within the Annual Tax on Enveloped Dwellings (ATED) regime. ATED is an annual tax payable by any non-natural person, for example a company, that holds an interest in a UK residential property valued at over £500,000. An ATED return must be filed, even when no tax is payable due to the availability of certain reliefs. 

At mgr, our expertise in the property sector equips us to help clients tackle the ATED deadline head-on with advice tailored to individual circumstances, helping them to access the reliefs available. 

The deadline to file ATED returns and pay any potential tax due for the year 1 April 2024 to 31 March 2025 is 30 April 2024. Any late returns or payments, or inaccurate returns could be subject to penalties and interest. If a property is acquired or had a change of use to residential part way through the year, the return will be due within 30 days. 

It’s important to note that it is not the value of the company’s individual interest in the property that determines whether they are in the scope of ATED, rather it is determined solely by whether the single dwelling interest (property value) itself exceeds £500,000.  

But how is the ATED charge determined? From 2012, properties must be revalued every five years. So, for properties acquired on or before 1 April 2022, the value of the property for ATED purposes is the open market valuation on 1 April 2022. If the property has been acquired after that date, then the valuation date would be the date of purchase, meaning the value is its purchase price. 

The ATED charge is based on the property value – for 2024/25 the charges begin at £4,400 for an interest in properties valued at more than £500,00 and is capped at £287,500 for values exceeding £20m. 

With just two weeks to go until the ATED deadline, please contact Esther Ollech at esther.ollech@mgr.co.uk for guidance tailored to your unique situation. 

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