The taxpayer has lost an appeal at the Upper Tribunal in a case concerning the meaning of residential property for SDLT purposes (The How Development 1 Ltd v HMRC [2023] UKUT 84 (TCC)). In particular, the case discussed the meaning of “land that is or forms part of the garden or grounds of a building”.
The FTT had noted that the woodland was not inordinately distant from the dwelling and that it afforded privacy and security. The FTT then commented that “the woodland does not need to be physically accessible to be part of the grounds”. The UT commented on this aspect as follows:
“The inaccessibility of the woodland did not preclude the FTT from concluding that the woodland formed part of the ‘grounds’. It was one factor – doubtless a countervailing factor – amongst others which the FTT took into account. The FTT was entitled to do so.”
The UT also stated that:
“The provision of privacy and security for a dwelling may fairly be seen as a residential purpose, regardless of the accessibility of the land which provides it.”
The UT did, however, criticise certain aspects of the FTT ruling, identifying four errors of law, which together were material errors. The UT had to decide whether to remit the decision or to remake it, and it chose the latter course of action. Weighing up all the relevant factors, the UT still concluded that the woodland formed part of the grounds.
https://www.bailii.org/uk/cases/UKUT/TCC/2023/84.html
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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.
