Taxpayer wins a mixed-use SDLT case
Posted on 20th June 2023 at 09:35
The message that I’d like readers to take from this case is that you should really take professional advice (from a specialist property accountant) about your SDLT position, and if the evidence is strong enough, have the courage to take this to tribunal.
This new case refers to mixed use #SDLT which is where you pay a reduced rate of stamp duty if you purchase a residential and commercial property in the same transaction.
#HMRC have a very impressive track record of winning SDLT cases in tribunal, but that we feel is mainly due to the “no win no fee” advisors who are making so many spurious claims. In this case, the taxpayer bought a large property with swimming pool, tennis court, garden but there was also a paddock – the paddock was not visible from the house, there was a small gate into the paddock from the garden but also there was access from a bridle path and the paddock was leased for grazing.
The taxpayers claimed “mixed use” because the paddock was not part of “grounds” as defined in legal precedence, and was a commercial property. Because the purchase was of two properties, the house and grounds as residential and the paddock as commercial, they were able to claim mixed-use SDLT.
HMRC refused to listen to reason and tried to force the taxpayer to agree with them, but they stood their ground, and it went to tribunal. The facts (there’s a lot more to the detail here) all tended to support the taxpayer who won in the first tier tribunal. There is a risk that this recent decision may be appealed by HMRC but for now, the extra £161,250 that HMRC sought is still in the taxpayers pocket.
If you need professional advice on an SDLT claim, drop us an email at info@property-tax-advice.co.uk
#sdlt #stampdutylandtax #mixeduse #
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