Can you claim Multiple Dwellings Relief after buying two HMOs if more than 12 months have passed?

Introduction

Buyers sometimes discover after completion that they may have paid too much Stamp Duty Land Tax (SDLT), especially where they bought more than one dwelling from the same seller on the same day. A common question is whether Multiple Dwellings Relief (MDR) can be claimed later to recover the overpayment.

This issue often arises with HMO purchases because the buyer may only later realise that the transaction involved more than one dwelling, or that linked transaction rules might have applied. The difficulty is that SDLT relief claims are usually subject to strict statutory time limits, and HMRC takes those limits seriously.

The Question

A buyer purchased two HMO properties in 2023 from the same seller, with both transactions completing on the same day. SDLT was paid separately on each purchase. The buyer now believes MDR might have reduced the tax and wants to know whether the overpaid SDLT can still be recovered.

The buyer is also considering buying three further HMO properties from the same seller and wants to understand how SDLT works where the purchases are linked, including whether the total consideration for linked transactions is the combined price of all the properties.

Nick’s Explanation

Nick’s main point was that a claim for MDR generally has to be made within 12 months of the filing date for the SDLT return, which in practice usually means a relatively short period after completion. He explained that HMRC is very strict about late claims.

In anonymised form, his view was:

“Unfortunately, a claim for multiple dwellings must be made within 12 months of purchase. HMRC is very strict about claims submitted after this time limit.”

Once it was confirmed that the two HMOs had been bought from the same seller and the relief had not been claimed simply because the buyer did not know about it, Nick’s conclusion remained that HMRC would be unlikely to accept an amendment made outside the statutory deadline.

On the proposed future purchase, Nick also identified an important separate issue: if several properties are bought from the same seller as part of a single scheme, arrangement or series of transactions, the linked transaction rules may apply. In that case SDLT is calculated by reference to the total consideration for all the linked purchases, not each property in isolation.

There was also a suggestion to review whether any property might genuinely fall outside the normal residential rules, for example because it was mixed-use or not suitable for use as a dwelling. But that depends on the facts as they exist at the effective date of the transaction. It is not enough to create a non-residential use later or to relabel part of the property after completion.

The Law

MDR was contained in Schedule 6B to the Finance Act 2003. Although MDR was abolished for most new transactions from 1 June 2024, it can still matter for earlier purchases where the effective date was before abolition.

Where MDR applied, SDLT was calculated by:

• taking the total consideration for the dwellings acquired,
• dividing that total by the number of dwellings,
• calculating SDLT on that average price, and
• multiplying the result by the number of dwellings, subject to the minimum tax rule.

That could produce a lower SDLT liability than taxing the full aggregate consideration in the ordinary way.

However, relief is not open-ended. The Finance Act 2003 contains time limits for amending SDLT returns and for making claims. In broad terms, where a buyer wants to amend the return to claim relief, the amendment must be made within 12 months of the filing date. HMRC generally has no discretion to accept a late amendment just because the buyer did not know the relief existed.

Linked transactions are governed by section 108 of the Finance Act 2003. Transactions are linked if they form part of a single scheme, arrangement or series of transactions between the same buyer and seller, or persons connected with them. If transactions are linked, the SDLT rate calculation is based on the total consideration for all linked transactions.

For mixed-use treatment, the subject matter of the transaction must include both residential and non-residential property at the effective date. A garden shed or outbuilding will not automatically make a purchase mixed-use. The question is whether there is a genuine non-residential element in law and fact.

For “not suitable for use as a dwelling” arguments, the threshold is now relatively high following Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799. A property will not fall outside residential treatment merely because it needs works, modernisation or improvement. The condition must be serious enough to mean it is not suitable for use as a dwelling at the relevant date.

Analysis

There are really two separate issues here: the historic 2023 purchases, and the proposed future purchases.

First, on the 2023 purchases, the fact that the two HMO properties were bought on the same day from the same seller suggests that the linked transaction rules may well have been relevant. If each property was a separate dwelling, MDR may also potentially have been relevant at the time. So, as a matter of substantive SDLT analysis, the buyer may be right that the original SDLT position could have been different.

But that does not answer whether the tax can still be reclaimed now. The main obstacle is the statutory time limit. If the SDLT returns were filed in 2023, the normal amendment window has almost certainly expired. A late realisation that relief might have applied does not usually reopen the return.

That is why Nick’s answer is essentially procedural rather than substantive: even if the buyer had a good MDR argument on the merits, HMRC is unlikely to accept a claim made after the statutory deadline.

Secondly, on the proposed purchase of three further HMO properties from the same seller, the buyer was right to question whether the total linked consideration should be the combined figure for all three properties. If each property costs £335,000, the total linked consideration would ordinarily be £1,005,000, not £335,000.

That total matters because SDLT on linked residential transactions is calculated by reference to the aggregate consideration. Depending on the buyer’s circumstances, the higher rates for additional dwellings may also apply.

If the three properties are all dwellings, bought from the same seller as part of one arrangement, the starting point is residential SDLT on the aggregate consideration. If there is a genuine basis for MDR, that would need to be considered under the rules in force at the effective date of the transaction. For post-1 June 2024 transactions, MDR is generally no longer available, so timing is critical.

As for mixed-use, the fact that a property has sheds or outbuildings does not by itself make the purchase mixed-use. The legal and factual character of the land at completion is what matters. If the sheds are simply ancillary to residential use, the transaction remains residential. A plan to turn one into an office later would not usually change the SDLT treatment of the original purchase.

Similarly, trying to argue that one of the properties is not suitable for use as a dwelling would require strong evidence about its actual condition at the effective date. After Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799, the threshold is high. Ordinary disrepair, dated condition, or a need for refurbishment will usually not be enough.

Outcome

For the 2023 purchases, the practical answer is that a late MDR claim is unlikely to succeed if the 12-month amendment period has passed. Even if the original transactions might have qualified for MDR, HMRC is generally strict about the statutory deadline.

For the proposed purchase of three further HMO properties from the same seller, the buyer should assume that the transactions are linked and that SDLT will be calculated by reference to the total combined consideration. If each property is £335,000, the relevant total is likely to be £1,005,000.

A mixed-use or “not suitable for use as a dwelling” argument should only be pursued if the facts genuinely support it at the transaction date. Those arguments are fact-sensitive and can be difficult to sustain.

Practical Steps

• Check the effective date and filing date of the original 2023 SDLT returns to confirm whether the amendment window has expired.
• Review the original contract structure to see whether the two purchases were linked transactions under section 108 Finance Act 2003.
• If considering a new purchase, add together the consideration for all properties being bought from the same seller as part of the same arrangement.
• Confirm whether the higher rates for additional dwellings apply to the buyer.
• Do not assume that an HMO, a shed, an outbuilding or a future office conversion makes the purchase mixed-use.
• If arguing that any property is not suitable for use as a dwelling, gather detailed contemporaneous evidence of condition at the effective date, bearing in mind the high threshold after Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799.
• For any substantial linked purchase, obtain a full SDLT calculation before exchange rather than trying to correct the position afterwards.

Conclusion

If more than 12 months have passed since the SDLT filing date, a late MDR claim for earlier HMO purchases is unlikely to be accepted by HMRC. For future purchases from the same seller, linked transaction rules mean SDLT is normally calculated on the combined price of all the properties. Any attempt to rely on mixed-use or unsuitability for dwelling use needs careful factual analysis and should not be assumed.

Legal References Used

• Finance Act 2003, section 108
• Finance Act 2003, Schedule 6B
• Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799

This page was last updated on 22 March 2026.

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