This was a successful appeal by the taxpayer about whether multiple dwellings relief (“MDR”) from SDLT applied to his purchase of a residential property with a self-contained annex. In a carefully structured and considered decision the FTT reviewed the evidence thoroughly and held that HMRC’s objections concerning the interconnecting doors and shared garden at the property did not prevent MDR from applying.
Although the interconnecting doors were not lockable at the effective date, the unchallenged evidence that the taxpayer had fitted security door braces shortly after completion meant that the FTT was satisfied that the internal connecting doors were capable of being made secure from both sides and the door braces were not considered to be alterations to the property.
In this regard, the FTT quoted HMRC’s own guidance at SDLTM00425 about whether the door between the annex and the main dwelling “can be locked, or is readily capable of being made secure from both sides.” With regard to HMRC’s objections that the shared garden allowed the occupant of the annex to look into the main dwelling and that occupant would expect to use the garden as a private, secure garden, the FTT dismissed these on the basis that a hypothetical tenancy agreement covering the annex would properly regulate these matters and that anyway, shared gardens and new property developments where occupants of one dwelling can see into another were not uncommon.
You can read the full decision here.
