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L-L-O Contracting Ltd vs HMRC: A Case Study of Multiple Dwellings Relief

Published by Sanjay Gautam
Published Date: November 2, 2023 , Updated Date: June 4, 2024
Categories: Case Law, HMRC, MDR

A recent case involving Stamp Duty Land Tax (SDLT) and Multiple Dwellings Relief (MDR) has shed light on the interpretation of certain legal provisions in the Finance Act 2003.

The case, which dealt with SDLT overpayment claims, raised questions about the term "mistake" in the context of tax relief. This article aims to provide a summary of the case and its implications.


The case revolved around taxpayers who paid SDLT and later sought MDR. The Finance Act 2003 contains the relevant legislation, which includes strict requirements for making MDR claims. These requirements include claiming MDR within a specific timeframe.

MDR Claims

Section 58D (2) of the Finance Act 2003 specifies that MDR "must be claimed in a land transaction return or an amendment of such a return." Furthermore, Schedule 10 para 6(3) sets the time limit for such claims at twelve months from the SDLT return's due date. MDR claim must be made within twelve months from when the SDLT return was required to be delivered.

The Dispute

The Dispute of L-L-O Contracting Ltd vs HMRC

The taxpayers did not initially make their MDR claims within their SDLT returns or by amending those returns. Instead, they submitted separate claims under Schedule 10 para 34. Schedule 10, paragraph 34 addresses claims for relief for overpaid tax.

It permits individuals to make claims for the repayment or discharge of amounts paid by way of tax if they believe that the tax was not due.

Paragraph 34A provides conditions under which HMRC is not obligated to give effect to such claims. It specifies situations in which HMRC is not liable to provide relief pertaining to overpayments resulting from mistakes in claims. HMRC rejected these claims, asserting that they were the result of a "mistake" for not making MDR claims within the necessary twelve-month timeframe in SDLT returns.

Legal Proceedings

HMRC sought to strike out the appeals, arguing that they had no reasonable prospect of success. A judge identified key legal issues that required clarification, and these issues became the focus of the hearing.

Key Issues & Resolution

  • Issue 1(a): Whether Schedule 10 para 34 allows a claim for overpayment relief, regardless of Section 58D's requirements.
  • Resolution: Both parties agreed that a claim under Schedule 10 para 34 could be validly made, despite Section 58D's requirements.
  • Issue 1(b): Whether, based on Section 58D (2), a person who failed to amend their return for MDR had not genuinely "overpaid" Stamp Duty Land Tax (SDLT).
  • Resolution: The judge found in favour of the taxpayers, ruling that a genuine SDLT overpayment could arise if a person failed to claim Multiple Dwellings Relief (MDR) in their SDLT return in accordance with Section 58D (2).
  • Issue 2: Whether HMRC was not liable to provide a SDLT repayment due to Case A applying, which relates to a mistake in failing to make a claim.
  • Resolution: The judge determined that HMRC was not liable to repay SDLT due to Case A applying, meaning that the SDLT overpayment was a result of a "mistake."

Interpretation of Mistake

L-L-O Contracting Ltd vs HMRC

The crucial issue in this case was the meaning of "mistake" in its statutory context. HMRC argued that a "mistake" could include situations where a person did not claim relief due to ignorance.

The judge concurred, stating that a "mistake" can result from oversight or ignorance.

Leveraging Legal Precedents

In the realm of taxation law, past cases hold valuable insights. The article references relevant case law to provide context and support for the decision. It discusses the implications of the "Candy" case, highlighting that the Upper Tribunal upheld HMRC's refusal to repay SDLT to a taxpayer who sought to amend their return after the statutory time limit.

Additionally, the article mentions cases such as "Smith Homes," "Secure Service v. HMRC," and "Warner v. HMRC" to underscore that the interpretation of "mistake" aligns with prior judicial decisions.


The judge decided in Favor of HMRC, agreeing that not amending the return within the time limit is subject to mistake, and the appeals were struck out. This case highlights the importance of understanding the legal requirements for tax relief claims and the significance of interpreting the term "mistake" in the context of the law.

In summary, this case underscores the significance of adhering to specific legal requirements for tax relief claims and demonstrates that the failure to make a timely claim in the required manner can be considered a "mistake," impacting a taxpayer's eligibility for repayment.

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Sanjay Gautam
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