Non-Resident Landlords

What is ATED and who pays it?

Answered by Jordan Onraet-Wells, Founder & Chartered Tax Adviser (CTA). Published 9 August 2026. Last reviewed 9 August 2026.

The short answer

ATED, the Annual Tax on Enveloped Dwellings, is an annual charge on companies, partnerships with a corporate member and certain collective investment vehicles that own UK residential property worth more than £500,000. Individuals who own a home in their own name are outside it entirely: ATED taxes the structure, not the property. For 2026/27 the charge runs from £4,600 for properties just over £500,000 up to £303,450 above £20 million, and the return and payment are due by 30 April within the year being taxed. Genuine commercial uses such as letting to unconnected third parties can be relieved to nil, but only if you file the return claiming the relief.

ATED applies where a company, a partnership with a corporate partner, or a collective investment vehicle owns a UK dwelling worth more than £500,000; personal ownership is outside the charge however valuable the home.
The 2026/27 charges are fixed by band: £4,600 (over £500,000 to £1 million), £9,450 (to £2 million), £32,200 (to £5 million), £75,450 (to £10 million), £151,450 (to £20 million) and £303,450 above £20 million.
The value used for 2026/27 is the property's value on 1 April 2022, or its cost if bought after that date; the next general revaluation date is 1 April 2027.
ATED is paid up front: the return and payment for 2026/27 are due by 30 April 2026, with in-year acquisitions reported within 30 days (90 days for a newly built dwelling).
Reliefs, such as for a commercial property rental business, reduce the charge to nil but must be claimed on a Relief Declaration Return by the deadline, and letting to a director, shareholder or family member can lose the relief.

A tax on the wrapper, not the house

ATED was introduced to discourage enveloping, the practice of holding high value UK homes inside a company or other corporate wrapper. Three conditions bring a property into scope: it is residential, it is owned by a company, a partnership with a corporate member or a collective investment vehicle, and it is worth more than £500,000. Where the company is incorporated and where its owners live make no difference, which is why cross-border owners are caught so often: a non-resident family holding a London flat through an offshore company is squarely within the charge. The full band table, filing timetable and reliefs are in our ATED and non-resident surcharges guide.

The charge, the valuation date and the unusual deadline

The tax is not a percentage of value. It is a fixed amount set by the band your property falls into, from £4,600 to £303,450 for 2026/27, and the charges rise each year with the previous September's CPI. The value used is the property's value on 1 April 2022, or acquisition cost if bought later, with a general revaluation every five years. Unusually, ATED is paid at the start of the year it covers: the 2026/27 chargeable period runs from 1 April 2026 and the return and payment are due by 30 April 2026. A property acquired mid-year is reported within 30 days of acquisition, or 90 days if newly built, and part-year ownership reduces the charge on a daily basis.

Reliefs exist, but you must file to get them

Where the company genuinely runs the dwelling as a commercial business, most commonly a property rental business letting to unconnected third parties on arm's length terms, a relief usually removes the charge to nil. Other reliefs cover developers holding stock, property traders, farmhouses, employee accommodation and dwellings open to the public at least 28 days a year. None of it is automatic: you must file a Relief Declaration Return by 30 April within the chargeable year, and missing that filing brings penalties even where no tax is due. Occupation by a director, shareholder or family member, even briefly, can deny the relief for the whole period. If you are weighing up whether a company wrapper still makes sense for UK property held from abroad, Horizon models the whole position on fixed fees agreed upfront, and a free clarity call at /book is the place to start.

Go deeper

Sources and further reading

This is general information for the 2026/27 UK tax year, not personal tax advice; speak to a Chartered Tax Adviser about your own position.

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