Yisroel Dreyfus v The Commissioners for HMRC
Decision date: 21 March 2024
Neutral citation: [2024] UKFTT 244 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This appeal concerned whether a former garage/annex at 60a Cranbourne Gardens formed a second dwelling, or was in the process of being constructed or adapted into one, at completion for the purposes of multiple dwellings relief (MDR) on an SDLT return. The Tribunal found the annex was not usable as a separate dwelling at completion and that the limited pre-completion works did not amount to a sufficient physical manifestation or sufficiently advanced adaptation under Schedule 6B paragraph 7(2)(b). The appeal was dismissed and HMRC’s increased assessment therefore stood.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
Paragraph 7(2)(b) requires some physical manifestation of construction or adaptation to have occurred by completion; mere preparatory steps or minimal works undertaken around exchange/completion are insufficient to treat a part of a building as a separate dwelling for MDR. The assessment is objective and evaluative, based on the physical attributes and facilities actually present at completion.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The Tribunal indicated that indicators such as separate utility meters, a separate postal address/Council Tax registration, lockable internal access, and adequate kitchen/bathroom fittings are persuasive evidence that a part of a property is suitable for use as a separate dwelling. It also noted that long delays between completion and finishing works, and absence of any letting activity, are relevant when assessing whether adaptation was sufficiently advanced at completion.