House purchase/conveyancing query

[bladebloke]

ColourRestorer said:

I agree totally with your last point, but unless I've misunderstood the rules, where the individual purchase price of each dwelling is below the 0% threshhold, as in the OP's example, then the multiple dwelling relief can only take the duty rate payable down to 1%, rather than zero.

You understand the rules correctly.

[Jobbo]

bladebloke said:

For interest, though, how did you come to conclude that the annex in the Mason case you linked to sounds more like a separate dwelling than the OP’s, when it didn’t have a kitchen and there was only one property for Council Tax? OP didn’t mention a kitchen but I assumed the annex has one (partly because it’s a separate dwelling for Council Tax).

I was being slightly naughty - the OP doesn’t mention kitchen or many other things which would be relevant but in the Mason case, a kitchen would easily be installed and the building was entirely detached and divisible. I don’t profess to have enough knowledge of the two cases to compare really.

My aim was simply to make it clear that this sort of thing is not straightforward and claiming a relief on a self-assessment tax is not the end of the story if HMRC decide to look at it. And they almost certainly will because ticking the MDR box in the SDLT return will flag it up to them to enquire. Much like buying a field with a house to make a transaction mixed use has become disallowed in most cases, I think they are going to challenge most annex MDR claims.

[Roy the Boy]

Just to close this off.

Thanks everyone for all the advice. My daughter has decided to give this house a wide berth, more so because of the almost £5k joint council tax on the '2' properties.

[springfan62]

She could modify the annex so that it can no longer be lived in independently such as by removing the kitchen and it would be removed from the council tax list.

[PistonBust]

springfan62 said:

She could modify the annex so that it can no longer be lived in independently such as by removing the kitchen and it would be removed from the council tax list.

You don't need to remove the kitchen. Just inform the council it's not being used as a separate dwelling anymore. They will then revalue the main house by bumping it up a grade.

[springfan62]

From gov.uk

If you’ve removed a separate area of living accommodation by making physical changes to your house, flat or other domestic property, you should contact the VOA. The VOA will only be able to remove a Council Tax band if the area or annexe has been sufficiently altered so that it could no longer be lived in separately.

[Roy the Boy]

Just to close this off.

Thanks everyone for all the advice. My daughter has decided to give this house a wide berth, more so because of the almost £5k joint council tax on the '2' properties.