Higher rate for additional residential properties

B the director of the taxpayer bought a bungalow described in a survey as being in a poor state of repair and requiring demolition due to the extensive presence of asbestos. HMRC said the additional rate of stamp duty land tax was due on the basis it was suitable for use as a dwelling (FA 2003 Sch 4ZA para 4).

The taxpayer appealed.

The First-tier Tribunal said the test in Sch 4ZA para 18 was whether the property was ‘suitable to be used as a dwelling at the time of purchase’. The judge said ‘a passing tramp or group of squatters’ could doubtless have lived in the bungalow as it was on the date of purchase but it was clear from the photographs of the property that it was not suitable as a dwelling. The intention of the buyer for the future use of the property was...