Richard Turner – Senior Manager
Multiple dwellings relief was abolished on 1st June 2024. However where a transaction had an effective date (usually, completion) before then, or after that date, where exchange of contracts occurred on or before 6th March 2024, the relief may still be available.
Where your transaction falls into this category and you wish to make a claim, you will have to do this within 12 months of the filing date of your SDLT return, which is usually 14 days after the effective date of the transaction.
HOW DOES THE RELIEF WORK?
An example:
- A property investor acquires 2 flats worth £250,000 each and a house for £400,000 in a single transaction.
- Under normal rules SDLT would be calculated on the total consideration of £900,000. SDLT due being £59,500.
- However, using multiple dwellings relief, we can use the average consideration (£900,000/3) to determine the rate applicable.
- This provides an SDLT liability of £34,500.
A saving of £25,000.
The application of the relief provides some attractive tax savings and also has some surprising applications.
For these purposes “dwelling” means a building or part of a building which is suitable for use as a single dwelling or is in the process of being constructed or adapted for such use. Accordingly, it may be possible, depending on the facts, that a self-contained annexe falls within the definition of a dwelling in its own right and therefore that the relief could extend and be applicable to more situations.
If this change is not of relevance to you, please do pass this on to anyone that you know will be affected by it. For specialist advice please do not hesitate to contact Menzies stamp duty tax expert, Richard Turner directly.
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