In the case of Shinebrook Ltd v HMRC [2026] UKFTT 602 (TC), the FTT has dismissed the appeal against closure notices denying stamp duty land tax (SDLT) multiple dwellings relief (MDR) on the purchase of the site of a former timber and builders merchant as the transaction was entirely “non-residential”. Prior to the purchase, the Appellant had acquired an option to purchase and had obtained planning permission to build 17 residential buildings.
STAMP DUTY LAND TAX – options and rights of pre-emption – grant of an option or right of acquisition in respect of non-residential property – whether the option and subsequent acquisition of the Property was a ‘linked transaction’ taxable at the ‘non-residential’ rate – whether the Property, at the time of completion, was in the process of “being constructed or adapted for use as a dwelling” pursuant to para. 7(2)(b) of Schedule 6B to the Finance Act 2003 – whether at the effective date of transaction the main subject-matter of the transaction consisted of an interest in at least two dwellings – whether multiple dwellings relief was applicable to the transaction – multifactorial assessment taking into account all the facts and circumstances – the objective observer test – Ladson Preston Ltd & AKA Developments Greenview Ltd v HMRC considered and applied – Appeal dismissed
The FTT identified the contested issues as follows:
“1) Whether the Appellant is entitled to MDR in respect of its acquisition of the Property on 12 May 2021. In particular: (i) whether, at the EDT [effective date of transfer], the ‘main subject-matter’ of the transaction consisted of an interest in ‘at least two dwellings‘, for the purpose of Schedule 6B of the Finance Act 2003 (‘FA 2003‘); or (ii) whether the Property was in the process of ‘being constructed or adapted for use as a dwelling‘, pursuant to para. 7(2)(b) of Schedule 6B at the EDT (‘Issue 1‘).
(2) Whether the acquisition of the option on 1 April 2021, and the acquisition of the Property upon exercise of that option on 12 May 2021, were ‘linked transactions‘. If so, whether the relevant land, an interest in which was the main subject-matter of any of the two linked transactions, was ‘non-residential’ property (‘Issue 2‘).”
In respect of Issue 1, although planning permission had been obtained and demolition work had begun at the EDT the FTT concluded that actual construction/adaption had not yet begun:
“In order to consider whether the transaction consisted of an interest in at least two dwellings, it is necessary to consider whether such buildings are ‘suitable for use as a dwelling’. Because of the arguments being relied on by the Appellant, it also necessary to consider whether a building was in the process of ‘being constructed or adapted’ for use as a dwelling …
… whilst obtaining planning permission can show the intention to build dwellings in the future, the planning permission only provides permission for it to be done and is not sufficient evidence to show that construction or works are underway. Importantly, the Appellant refers to construction/adaptation. This supports the conclusion that no buildings were being used (or were suitable for use) as a dwelling. Obtaining planning permission is not part of the construction/adaptation of a building. …
… Having considered all of the evidence before us, cumulatively, we find that the Appellant has failed to establish that the Property was in the process of being constructed or adapted for use as a dwelling. Indeed, the documentary evidence relied on by the Appellant in this appeal has given rise to more questions, than answers. Consequently, therefore, the Appellant has failed to establish entitlement to MDR.”
With regards to Issue 2:
“The transaction to which the SDLT in dispute in this appeal relates is the purchase of the Property, as provided for in the contract of purchase, and completed by the transfer on 12 May 2021. The subject-matter of that transaction was of a property that was ‘non-residential’. We have found that no dwellings were in the process of being constructed. In accordance with ss 55(1), (4) and 116(1) FA 2003, the nature of the option or right of pre-emption follows the nature of the underlying property over which the option or right of pre-emption is acquired. The acquisition of the option by the Appellant is a land transaction. In accordance with s 45(3) FA 2003, the EDT of the option is 1 April 2021. It would not be regarded as the acquisition of a major interest in land. As no part of the consideration is chargeable at a rate of more than 0%, the acquisition of the option is not a notifiable transaction, in accordance with s 77(1)(b) FA 2003. Because the underlying land was non-residential property, the rates applicable to the option are those which apply to non-residential property. Therefore, the rates of SDLT at Table B of s 55 apply to the option.
The transfer pursuant to the exercise of the option on 12 May 2021 constituted a separate land transaction from the grant of the option. Pursuant to s 108 FA 2003, the two are linked transactions. Section 108 provides that:
‘Transactions are “linked” for the purposes of this Part of this Act if they form part of a single scheme, arrangement or series of transactions between the same vendor and purchaser or, in either case, persons connected with them.’ …
Accordingly, therefore, the appeal is dismissed and the Closure Notice is upheld.”
https://caselaw.nationalarchives.gov.uk/ukftt/tc/2026/602?
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Stamp Duty Land Tax is a well-written, user-friendly guide to the complexities of SDLT, written for accountants, solicitors and other tax professionals, with plenty of worked examples. Topics covered include basic principles, leasehold transactions, partnerships, trusts, reliefs, anti-avoidance legislation and recent tribunal decisions. Full reference is made throughout to relevant legislation, case law and guidance from HMRC.
