Andrew Jonathan and Della Ann Bloom v The Commissioners for HMRC
Decision date: 12 July 2023
Neutral citation: [2023] UKFTT 628 (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
The appellants purchased a house with adjoining land including a sewage treatment plant (STP) and claimed part of that land was non‑residential for SDLT purposes to obtain a refund. The First‑tier Tribunal found the 5.6‑acre Disputed Area, despite housing the STP, formed part of the garden or grounds of the dwelling (s.116(1)(b) FA 2003) and that there was no evidence of genuine commercial exploitation. The appeal was dismissed and HMRC's closure notice upholding the SDLT assessment was confirmed.
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: medium
Where land adjoining a dwelling houses an essential utility serving that dwelling (here an STP) and there is contiguity, common ownership, historic use, proximity and a functional relationship to the dwelling, that land can be characterised as part of the garden or grounds for SDLT purposes unless there is evidence of separate, active commercial exploitation. A mere cost‑sharing covenant for maintenance does not of itself convert such land into non‑residential or demonstrate a commercial trading arrangement.
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 noted that absence of precise area measurements and imprecise witness evidence weakens a claimant's position; limited intrusions (periodic servicing or occasional odour) are unlikely on their own to render land non‑residential; and that CGT or permitted area concepts are not determinative of SDLT characterisation.