The purchasers of properties with self-contained annexes before 1 April 2016 might have unknowingly overpaid Stamp Duty Land Tax (SDLT).

"Granny annexes" have been in the news a lot recently following introduction of the higher rate SDLT charge for additional residences from 1 April 2016.

Changes were made to the original proposals for the additional charge so that properties with self-contained annexes could be treated as single dwellings and not automatically be subject to the higher rates of SDLT. This has highlighted the fact that these properties have sometimes been wrongly treated as a single property for SDLT in the past.

If an annexe is suitable for use as a dwelling separately from the main house, with its own access, kitchen, bathroom, bedroom and living areas, then your property consists of two dwellings and may be eligible for Multiple Dwellings Relief (MDR).

Claiming MDR relief can produce significant savings, for example SDLT on a property costing £500,000 would be reduced by £10,000.

You have 13 months from the date of purchase to amend your Return and reclaim overpaid SDLT so a claim could still be possible if you bought your property within this time-frame.

If you think you may be affected by this and have further questions or would like help with making a claim please contact one of our team.


Stamp Duty Land Tax: rates & reliefs

SDLT & residential property: higher rate