HMRC have published a consultation, Stamp Duty Land Tax: Mixed-Property Purchases and Multiple Dwellings Relief.  The aim is to collate views on how to achieve fair tax outcomes and to prevent Stamp Duty Land Tax (SDLT) abuse for mixed property transactions and for Multiple Dwellings Relief (MDR) claims.

At a glance

HMRC is considering hypothetical changes to the way in which the SDLT liability is calculated for both residential and non-residential property. Views are sought from respondents on the effect that these changes could have on taxpayers and commercially, they include:

  • Apportioning the total consideration between residential and non-residential elements of a transaction and calculating the tax on each part accordingly.
  • Introducing a threshold whereby transactions would need to constitute a significant amount of non-residential property to be treated as non-residential transactions.

HMRC have made a number of different proposals that would reform and limit the application of Multiple Dwellings Relief (MDR) which currently applies where more than one dwelling is purchased as part of a single or linked transaction. These proposals include:

  • Introducing a purpose test allowing MDR only if either all or some, of the dwellings, are purchased for either development and resale or exploitation as a source of rents.
  • Aligning MDR to the subsidiary dwelling exemption which applies to the higher rates of SDLT.
  • Allowing MDR for purchases of three or more dwellings rather than two currently.

Responses can be made via email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Responses are requested by 22 February 2022.

Useful guides on this topic

SDLT: Stamp Duty Land Tax, start here
What is SDLT? What are the SDLT rates? What is exempt from SDLT? What reliefs are available? When are returns due? When can you amend a return?

SDLT: Multiple Dwellings Relief
What is Multiple Dwellings Relief (MDR) for Stamp Duty Land Tax purposes? When does it apply and how is it claimed?

SDLT: MDR & Annexes Tool
Stamp Duty Land Tax (SDLT) Tool, if you are buying two or more properties in a single transaction use this tool to see if you meet the qualifying conditions and you may be able to claim both Multiple Dwellings Relief and relief from the Higher Rate Charge.

SDLT: Residential property & dwellings
What is residential property for Stamp Duty Land Tax (SDLT)? What tax rate applies? What garden and grounds are subject to higher rates of SDLT?

SDLT: At a glance, Stamp Duty Land Tax, rates & allowances
What is Stamp Duty Land Tax (SDLT)? What are the rates of Stamp Duty Land Tax (SDLT)?

External Links

Stamp Duty Land Tax: mixed property purchases and Multiple Dwellings Relief

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