The First-tier Tribunal (FTT) recently delivered a notable ruling, clarifying the meaning of "suitable for use as a single dwelling", while the appellant was pursuing a claim for Multiple Dwellings Relief (MDR) under the Stamp Duty Land Tax (SDLT) regime. The case concerned an annex at Oakridge Farm which shared various features with the main dwelling.
The FTT ruled in favour of the appellant, applying the multi-factorial assessment established in Fiander v HMRC [2021] UKUT156 (TCC). It found that HMRC's objections; including the absence of separate utility meters, a shared postal address, and the lack of a separate council tax registration; is common in landlord-tenant relationships. Utility costs are conventionally included in the rent (including council tax), and therefore the absence of separate utility meters or council tax bills did not, in the FTT’s view, undermine the annex’s level of self-sufficiency. Instead, the presence of an independent dwelling was evidenced by the fact that all utilities could be controlled from within the annex, including independent electric heating, a separate fuse box, and water supply.
Moreover, although the annex had an interconnecting internal door with a thumb-turn locks accessible from the main dwelling, the door was soundproof and locked on the annex side at completion with no key provided to the main dwelling occupants. This afforded both the Annex and the Main Dwelling the degree of security consistent with the concept of each being a single dwelling.
To summarise, the FTT emphasized that the test is contextual and fact-specific, rejecting a "one size fits all" approach. The decision reinforces that accommodation meeting basic living needs with reasonable privacy, security and self-sufficiency can qualify for MDR, even where some shared arrangements exist.
The appeal was allowed, confirming the Appellant's entitlement to MDR and the reduced SDLT liability.
Read the full decision of Behenna-Renton v Revenue and Customs [2025] UKFTT 403 (TC) here.
