VAT Director Rayner Essex
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SDLT: Use and abuse of multiple dwellings relief

Multiple dwellings relief (MDR) may be suggested to some buyers as a means of saving Stamp Duty Land Tax (SDLT), but the application of the law is somewhat subjective and buyers continue to push the boundaries.

27th Aug 2020
VAT Director Rayner Essex
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Elizabethan Manor house in the Cotswolds, Oxfordshire, England
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In simple terms, MDR applies when purchasing more than one residential property in a single transaction and allows the buyer to take the average value of the multiple purchases when calculating the stamp duty land tax (SDLT) due. 

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Replies (4)

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By Justin Bryant
27th Aug 2020 13:47

The Merchant and Fiander cases are more or less chalk & cheese as the former was a clear try-on by an unregulated MDR claims firm who aren't even general SDLT specialists (or proper tax advisors), yet Fiander was very much an arguable MDR case and is being appealed to the UT.

As for care & caution, what was the downside for the above unsuccessful try-on? Little if anything if the fees were refunded (at most bit of interest on over refunded SDLT ).

Advisors will be more concerned about potentially being sued for overlooking such claims.

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Replying to Justin Bryant:
By aiwalters
15th Oct 2020 13:53

sorry- I replied to the wrong comment, and I can't see how to delete. Ignore.

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By aiwalters
15th Oct 2020 13:52

Quote:

However, the corridor gave open access to the main house, and the annex did not exist on the land registry or council records as a separate dwelling. It also shared some services. .

This is very misleading. The FTT gave very little weight to the council records and services. The test was found to be based on whether the property is physically suitable as a separate property, thus the first point regarding the corridor was valid, but the second, not.

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By Jane31
11th Feb 2021 12:41

If a residential property comprising two dwellings (main house and granny flat) is purchased and all parties agree that this is a purchase of multiple dwellings, would the 3% surcharge apply?

If so, is the interaction with MDR along the same lines as in the example given?

Thanks in advance.

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