In 39 Fitzjohn's Avenue Limited v HMRC [2024] TC9021, the First Tier Tribunal (FTT) found that a London property which had a railway tunnel vent in its garden and workshop in its basement was a dwelling and not a mixed-use property for Stamp Duty Land Tax purposes.

  • The £19,750,000 property was purchased in 2018 and Stamp Duty Land Tax (SDLT) was paid at the Residential Rate on acquisition.
  • SDLT specialists contacted that buyer to suggest that SDLT had been overpaid.
  • An Amendment to its SDLT return was made and £1,899,250 was reclaimed on the basis that the non-residential rate applied as the land on which the property stood was in mixed-use.
  • HMRC raised an SDLT assessment which the buyer appealed.

The FTT found:

On the ventilation shaft:

  • There was a ventilation shaft with railings for an underground railway tunnel in the large garden.
  • A rail company had rights under an old indenture but it was overgrown and did not impede the enjoyment of the property in any major way and did form part of the grounds.

On the workshop:

  • There was some evidence of a small workshop in the building that a carpenter had been using but no formal lease was in existence.
  • The previous owner had been contacted and he said, “I can confirm that prior (sic) selling my house in 2018 known as '39 Fitzjohns Avenue N23 5JT' to 39 Fitzjohns Avenue Ltd the workspace at ground floor level was let on a license to a tenant who paid me on a monthly basis.”
  • However, the contract for sale of the Property firmly stated: “The Property is sold with vacant possession (here meaning vacant of persons and free from any occupational interests) on completion… .”

The FTT found that the property owner had failed to discharge the burden of proving that there was a commercial tenancy in place at the time of completion and had failed to prove that any part of the dwelling was unsuitable for use as a dwelling.

The Appeal was dismissed.,

Usefuguides 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: Residential property higher rates
A guide to the Stamp Duty Land Tax (SDLT) higher rate charge on residential property, when it applies and what reliefs are available to exempt buyers from the charge.

SDLT: Amending returns & refunds
How do I amend an SDLT return? When can I amend an SDLT return? How do I claim an SDLT refund? How do I deal with contingent consideration?

External links

39 Fitzjohn’s Avenue Limited v HMRC [2024] TC9021