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Posted Thu, 07 Apr 2022 13:42:23 GMT by Fozia Muddassir
Are HMOs a single dwelling in it's entirety as a building value or is the value for ATED purposes the individual unit apportionment? There is little guidance on the manuals and conflicting information from specialists.
Posted Fri, 08 Apr 2022 09:32:14 GMT by HMRC Admin 20
Hi Fozia Muddassir,

Please see Annual Tax on Enveloped Dwellings guidance at:

How to value different types of properties and multiple interests

or ring our ATED helpline on 0300 200 3510

Thank you.
Posted Fri, 08 Apr 2022 13:22:43 GMT by Fozia Muddassir
Unfortunately I am going round in circles. I called the ATED helpline and they said yes but could not confirm if it was yes the whole building has to be considered as a single dwelling OR yes the individual rooms in a could be considered as single dwellings? I was then told to email the ATED team and still await their reply. The guidance you refer to does not answer my question.
Posted Fri, 22 Apr 2022 11:59:14 GMT by Alan Rolfe
Is any more clarity available on this? The legislation in Sections 117 and 118 of Finance Act 2013 appears to provide an exclusion from treating two parts of a building as linked dwellings if an ATED relief (such as a letting business) applies - see Section 117(4)(a). Does this mean that HMO's and similar shared flats are not reportable, even if the value of the whole building is greater than £500k, provided the individual flats/rooms are used for a letting business and are not available to a "relevant individual"?
Posted Wed, 27 Apr 2022 07:37:23 GMT by HMRC Admin 19
Hi Alan Rolfe,

You will need to contact the ATED helpline regarding your query on 0300 200 3510.

Thank you.
Posted Sat, 07 May 2022 14:54:12 GMT by Fozia Muddassir
-UPDATE - Reply received from ATED department via email: "Its my view that a HMO would be classed as a single dwelling interest and treated as one residence. If the unconnected people living in that property are paying rent then the company may be eligible for relief. Conditions for relief can be found in our technical guidance :"
Posted Tue, 10 May 2022 08:42:07 GMT by Alan Rolfe
Fozia, thanks for posting that reply. Unfortunately it does not seem to make clear why the ATED department holds that view. In addition to the legislation mentioned before that seems to disapply linking where an ATED exemption applies, a further look at the legislation also suggests that the condition for "private access" in s117(1)(b) may not be met. Private access is defined in s118(2) of FA 2013 and appears to exclude an access using a part of the building that another party (besides the occupiers of the two rooms to be linked) has a right to use. In other words if, say, a shared living room has 3 (locked) bedrooms leading from it, the access from room 1 to room 2 using this shared space would be accessed by the occupier of room 3 in addition to the residents in rooms 1 and 2. This may mean that there is no private access between rooms 1 and 2. The lack of clear guidance about HMO's and the reasons why they may fall within ATED is frustrating. We are waiting on an e-mail from the ATED team, so maybe something more concrete will be forthcoming, but it would be great to get more certainty regarding how the legislation should be interpreted.

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