HMRC One to Many letters - ATED Avoidance Qualifying Property Business Relief

HMRC have advised us that they have recently commenced a One to Many letter campaign directed at offshore corporates who owned UK residential property over £500,000 but were registered and reported consecutive losses on their self-assessment returns from their property rental income from 2017/18 to 2019/20.

There are four letters which have been sent out: one for companies that have filed for Annual Tax on Enveloped Dwellings (ATED) property rental business relief and one for companies that have not. There are then variations of both letters for the represented and unrepresented. A schedule of information and documents (the Encompassing Schedule) is sent with the letters from HMRC.

The letters encourage companies to file outstanding ATED returns for anything they owe and have not already paid/reported and to correct their position going forward. HMRC want the companies and representatives to reassess their loss-making UK rental businesses and register for ATED and file all applicable ATED liability returns. The population will be sent a letter inviting a disclosure, ATED registration or, alternatively, be asked to provide information to evidence that they are a qualifying property rental business.

HMRC’s intention is to continue to issue the letters in small tranches/numbers over the next few months. This will continue into 2025/26.

ATED Avoidance Qualifying Property Business Relief letter (Non relief filer)
ATED Avoidance Qualifying Property Business Relief agent letter (Non relief)
ATED Avoidance Qualifying Property Business Relief letter (Relief filer)
ATED Avoidance Qualifying Property Business Relief) agent letter (Relief filer)
ATED Avoidance Qualifying Property Business Relief - Schedule of information and documents enclosed with the letters

Assisting clients with making disclosures to HMRC - guidance for CIOT members                       

The CIOT has produced guidance for members assisting clients who may have additional tax liabilities to disclose to HMRC – see Assisting clients with making disclosures to HMRC - guidance for CIOT members. It explains the different processes through which taxpayers can make disclosures and explains that members should choose the disclosure service which is most appropriate for their client’s circumstances given all the issues to be corrected and the reason(s) why the inaccuracy(ies) occurred. Members may find it helpful to refer to this guidance when assisting a client in responding to HMRC’s letter.