The taxpayers amended their SDLT return to show that a lower amount of tax was due on the basis that the property acquired was not suitable for use as a dwelling (Mudan v HMRC [2023] UKFTT 00317 (TC)). HMRC issued a closure notice, rejecting the reduction.
The FTT agreed with HMRC, concluding:
“I consider that a building which was recently used as a dwelling, has not in the interim been adapted for another use and is capable of being so used again (a building, such as the one in Bewley, the defects in which cannot be put right at all, will not be capable of being so used) will count as a dwelling, even though it is not ready for immediate occupation, unless the reason/s why it is not ready for immediate occupation are so fundamental (being radioactive or at high risk of collapsing, for example) that the work required to put these problems right goes beyond anything that might ordinarily be described as repair, renovation or “fixing things” (examples of this sort of work being installing a new boiler or heating system, damp problems or floors needing replacing).”
In this case, the works required did not come anywhere near that threshold.
https://www.bailii.org/uk/cases/UKFTT/TC/2023/TC08777.html
Related content from Claritax Books
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.
