Question:
I am currently in the process of purchasing a property which includes a separate granny annex. Since there is only one title number for the whole property, can I apply for stamp duty land tax multiple dwelling relief (MDR)?
Answer:
Since 1 April 2018 SDLT applies to land transactions in England and Northern Ireland only. Property transactions in Scotland are subject to Land and Buildings Transaction Tax. Land Transaction Tax (LTT) applies to land transactions in Wales.
Broadly, if the granny annex is an independent dwelling, then it will count for MDR. If it cannot exist independently of the main house, then MDR will not be available.
The HMRC Stamp Duty Land Tax Manual states (SDLTM29955):
‘For the purposes of the relief a “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.’
Special rules apply to certain types of dwellings, including halls of residence and ‘off plan’ transactions. See the HMRC Stamp Duty Land Tax Manual for further information.
