Who is liable to pay ATED?
The Annual Tax on Enveloped Dwellings (ATED) is a charge that applies to certain high-value residential properties held by non-natural persons (NNPs). It is designed to ensure that residential properties held through corporate or similar structures are subject to an annual tax charge where their value exceeds a set threshold.
ATED is payable mainly by companies that own UK residential property valued at more than £500,000. However, this liability can also extend to other NNPs that own interests in UK dwellings including certain partnerships where companies are members, and managers of collective investment schemes, all of which are treated as NNPs under the legislation.
A property is treated as a dwelling for ATED purposes if it is used, or could be used, as a residence, such as a house or flat, and includes any associated gardens, grounds and buildings within them.
For the current charging structure from 1 April 2026, ATED is calculated based on the value band of the property as follows:
- Properties worth over £500,000 but not exceeding £1 million: £4,600
- Properties worth over £1 million but not exceeding £2 million: £9,450
- Properties worth over £2 million but not exceeding £5 million: £32,200
- Properties worth over £5 million but not exceeding £10 million: £75,450
- Properties worth over £10 million but not exceeding £20 million: £151,450
- Properties worth over £20 million: £303,450
