Guidance

Capital Gains Tax on high value residential property

If you pay Annual Tax on Enveloped Dwellings, you must pay Capital Gains Tax when you sell the property up to 5 April 2019, or Corporation Tax from 6 April 2019.

Overview

Annual Tax on Enveloped Dwellings (ATED) related Capital Gains Tax is payable mainly by companies that own UK residential property valued at more than £500,000.

You’ll need to complete an ATED-related Capital Gains Tax return if your property:

  • is a dwelling
  • is in the UK
  • was valued at more than:
    • £2 million (for returns from 6 April 2013 to 5 April 2015)
    • £1 million (for returns from 6 April 2015 to 5 April 2016)
    • £500,000 (for returns from 6 April 2016 to 5 April 2019 onwards)
  • is owned completely or partly by a:
    • company
    • partnership where any of the partners is a company
    • collective investment scheme - for example a unit trust or an open ended investment vehicle

Returns must be submitted by 31 January after the chargeable period.

You do not pay ATED or ATED-related Capital Gains Tax if you own the property direct, rather than through a company.

If you’re a non-resident company find out more about Capital Gains Tax when selling (or disposing) of UK property or land.

Disposals made up to 5 April 2019

How much your company will pay depends on how long it has:

  • owned the property
  • been paying ATED on the property

You can find examples on how to work out the gain in the Capital Gains manual.

The rest of the gain or loss may be chargeable to Corporation Tax or Capital Gains Tax.

Tell HMRC if you have an ATED-related Capital Gain for disposals made before 6 April 2019 by completing the ATED-related Capital Gains Tax return form.

You’ll need to pay by 31 January following the end of the tax year.

Find out the ways to pay your ATED-related Capital Gains Tax.

Disposals made from 6 April 2019

For disposals made from 6 April 2019, ATED-related Capital Gains Tax will no longer apply.

Any gain made by your company from this date will be liable to Corporation Tax and must be declared on your company’s Corporation Tax return.

If you do not already submit a Corporation Tax return, you must register a non-resident company for Corporation Tax.

Published 3 November 2014
Last updated 6 April 2019 + show all updates
  1. The guidance has been updated to reflect that ATED-related Capital Gains Tax will no longer apply from 6 April 2019, the extension of non-resident Capital Gains Tax to include all UK property or land and non-resident companies disposing of UK property or land now being liable to Corporation Tax.

  2. The page has been updated in line with the Annual Tax on Enveloped Dwellings guidance about property.

  3. The 'Overview' section has been updated.

  4. The tax threshold for Annual Tax on Enveloped Dwellings related Capital Gains Tax will reduce over 2 years from 6 April 2015.

  5. First published.