HMRC SDLT: SDLTM29957 – Relief for transfers involving multiple dwellings: treatment of student accommodation

Principles and Concepts of SDLTM29957

This section of the HMRC internal manual provides guidance on the relief available for transfers involving multiple dwellings, specifically focusing on student accommodation. It outlines the conditions and criteria necessary for claiming relief.

• Relief applies to transactions involving multiple dwellings.
• Special considerations are given to student accommodation.
• Guidance on eligibility and application process for relief.
• Clarification on how relief affects tax calculations.

Understanding Relief for Transfers Involving Multiple Dwellings: Student Accommodation

The relief for transfers involving multiple dwellings is a vital area within the stamp duty land tax (SDLT) framework. This guide spells out the key concepts and practical examples related to this relief, particularly in the context of student accommodation.

What is the Relief for Transfers Involving Multiple Dwellings?

This relief allows buyers to benefit from a reduced rate of SDLT when they purchase multiple dwellings in a single transaction. When properties are bought together, this relief can significantly lessen the overall tax burden. The relief encourages investment in housing, especially where there is a need for affordable student housing.

When Does the Relief Apply?

The relief applies under specific conditions:

• The transaction must involve at least two dwellings.
• The properties must be purchased as part of a single transaction.
• Each dwelling must meet certain criteria for the relief to be applicable.

In short, if you are purchasing multiple properties simultaneously, you may qualify for the relief. This is particularly relevant for large student accommodation buildings or complexes that are designed to house more than one student.

Key Definitions

To fully understand this relief, it is essential to know some terms:

• Dwelling: A dwelling is any property that can be used for residential purposes. This includes houses, flats, and other types of residential buildings.
• Linked Transactions: These are set of transactions that are dependent on one another. If you buy multiple properties that are linked, the relief may apply to the entire transaction.

Examples of Relief Application

Here are a few practical examples to illustrate when the relief applies:

• Example 1: If a university purchases a building that contains 50 individual student flats in one transaction, they can claim this relief as all the flats count as separate dwellings.
• Example 2: A developer buying a block of six apartments, which they plan to convert into student accommodation, would also be eligible for the relief because they are acquiring multiple dwellings in a single transaction.

Eligibility Criteria for Student Accommodation

Not all student accommodation will automatically qualify for the relief. Certain factors must be taken into account:

• The property must be suitable for residential use and complete.
• The accommodation can be for both full-time and part-time students.
• Short-term lets or holiday accommodations typically do not qualify as student accommodation for this relief.

Important Notes to Consider

Recently, changes have been made to the rules surrounding multiple dwellings relief. As of 1 June 2024, certain old rules are being abolished.

• The minimum dwelling rate transaction amount and the treatment of linked transactions will also evolve from this date, subject to special transitional rules.
• It is essential to consult the latest guidance at SDLTM29903 for linked transactions.

Calculating the Relief

When calculating how much relief you can claim, it is important to know how to assess the overall value of the transaction:

• The total purchase price of all the dwellings will form the basis for the stamp duty calculation.
• Calculate the SDLT on the purchase price as if the relief were not in place.
• Then apply the relief to find the final amount due.

Claiming the Relief

To claim the relief, you generally need to fill out an SDLT return, ensuring to detail all relevant information on the multiple dwellings being purchased. You need to:

• Provide clear details of each dwelling involved.
• Clearly state the total value of the properties involved.
• Indicate that you are claiming the relief on your return.

It can be beneficial to seek professional advice when filling out the SDLT return, especially with factual complexities such as linked transactions.

Further Guidance

For in-depth details on how student accommodation interacts with the relief for transfers involving multiple dwellings, refer to the specific guidelines provided at SDLTM00377.

Follow these guidelines and maintain close awareness of your eligibility, as these details can significantly impact your financial planning concerning student accommodation investments.

Additionally, be aware that the rules can change, and it is beneficial to stay updated with the latest from HMRC. Regularly reviewing the updates can help you take advantage of reliefs and exemptions available in the future.

Useful article? You may find it helpful to read the original guidance here: HMRC SDLT: SDLTM29957 – Relief for transfers involving multiple dwellings: treatment of student accommodation

View all HMRC SDLT Guidance Pages Here