Can You Resubmit an SDLT Uninhabitable Property Claim if the First Claim Was Withdrawn?

Introduction

People often ask whether a Stamp Duty Land Tax (SDLT) refund claim can be made for a property bought in very poor condition, especially where the building later had to be stripped out or even demolished. A related question is whether a claim can be made again if an earlier claim was withdrawn and never formally decided by HMRC.

This issue matters because the SDLT treatment of a damaged or derelict building depends on whether, at the effective date of the transaction, the property was still a “dwelling” for SDLT purposes. That is a fact-sensitive question. It also depends heavily on evidence. Recent case law has clarified the legal test, but it has also made clear that the threshold for showing a property was not suitable for use as a dwelling is now relatively high following Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799.

The Question

A buyer purchased a residential property in a very poor state. The reported problems included major roof defects, water ingress, mould, long vacancy and a later need for demolition because of the building’s condition. The buyer had previously started an SDLT claim on the basis that the property was not suitable for use as a dwelling, but that earlier claim was withdrawn before HMRC formally determined it.

The buyer now wants to know:

• whether a fresh SDLT claim can still be submitted;
• whether photographs and a local authority council tax discount for an uninhabitable property are enough evidence; and
• how the more recent Mudan case affects the position.

Nick’s Explanation

Nick’s core view was that the claim may still be capable of being pursued, but that the real issue is evidence rather than theory. In anonymised form, his explanation was:

“I have always considered the claim potentially viable. The difficulty is evidence. It is for the taxpayer to prove the factual assertions relied on.”

He also explained that the earlier claim had been withdrawn voluntarily and, because it was not formally determined by HMRC, that does not necessarily prevent a fresh claim being made within the statutory time limit.

On the impact of the case law, his point was that Mudan v HMRC clarified the argument about a building having “lost its identity” as a dwelling. In practical terms, however, a claimant still needs strong contemporaneous material showing the property’s true condition at the date of purchase.

Nick suggested that stronger evidence would usually include:

• a witness statement from the buyer describing the condition at completion;
• a statement from a builder, contractor or surveyor explaining why the building was not fit for residential use and why demolition or major reconstruction was required;
• historic sales particulars, photographs, inspection reports or similar material from around the purchase date; and
• any other objective evidence showing the extent of the defects at the relevant time.

The Law

SDLT is charged under the Finance Act 2003. Whether residential rates apply depends in part on whether the subject matter of the transaction includes a “dwelling”.

The key statutory provisions are in Schedule 4ZA to the Finance Act 2003, which uses the concept of a dwelling and includes the familiar wording about a building that is “used or suitable for use as a dwelling” or is in the process of being constructed or adapted for such use.

In disputes of this kind, the central legal question is usually whether the property was suitable for use as a dwelling at the effective date of the transaction. That is not decided simply by asking whether the property was unpleasant, in disrepair, vacant, or in need of renovation. The condition must be serious enough to take the building outside the concept of a dwelling for SDLT purposes.

The courts have considered this in a line of cases, culminating in Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799. That decision is now especially important in uninhabitable property cases. It confirms that the threshold is relatively high. A building does not cease to be a dwelling merely because it is dilapidated, unsafe in some respects, or requires extensive works. The condition must be such that, viewed realistically at the effective date, it is no longer suitable for use as a dwelling, and arguments that it has “lost its identity” as a dwelling will only succeed on strong facts.

Another important procedural point is that SDLT amendments and repayment claims are subject to time limits. Whether a fresh claim is still possible depends on the procedural history and the applicable statutory deadline. If an earlier claim was withdrawn and never finally determined, that may leave room for a fresh submission, but only if the time limit has not expired and no binding determination prevents the point being raised again.

Analysis

The position can be analysed in four steps.

First, was the earlier claim finally decided by HMRC? If a claim was merely withdrawn and there was no formal closure notice, amendment conclusion or tribunal determination, there may be no procedural bar to a new claim. That is why the exact status of the earlier correspondence matters.

Second, is the claim still within time? A fresh claim must still fall within the relevant statutory deadline. If the deadline has passed, the merits may not matter. If it remains in time, a new submission may be possible.

Third, does the condition of the property meet the legal threshold? This is where many claims fail. Evidence of a leaking roof, mould, infestation, long-term vacancy, neglect or even serious disrepair may support the argument, but those matters do not automatically prove the building was not suitable for use as a dwelling for SDLT. Following Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799, the threshold is now relatively high in uninhabitable or not suitable for use cases. The fact that a property was later demolished may help, but it is still necessary to show what the condition was at the effective date of the transaction and why that condition meant the building had ceased to be a dwelling in SDLT terms.

Fourth, what weight should be given to a council tax discount or exemption? A local authority decision to grant an uninhabitable council tax discount can be helpful evidence, but it is not conclusive for SDLT. Council tax and SDLT are different legal regimes with different tests. One public body’s view does not bind HMRC. The discount may support the factual picture, but it will rarely be enough on its own.

That means photographs and local authority correspondence are useful, but they are usually best treated as supporting evidence rather than the whole case. The strongest claims tend to include independent professional evidence explaining:

• the structural or functional defects present at completion;
• why ordinary occupation as a dwelling was not realistically possible;
• whether key parts of the building fabric or services had failed;
• whether repair was possible short of reconstruction or demolition; and
• why the building had, on the facts, ceased to retain its identity as a dwelling.

In short, the legal route may still be open if the earlier claim was withdrawn and the deadline has not passed. But success will depend on whether the evidence can meet the stricter post-Mudan standard.

Outcome

A fresh SDLT claim may still be possible where an earlier claim was voluntarily withdrawn and never formally determined by HMRC, provided the statutory time limit has not expired.

However, a claimant should not assume that poor condition, a council tax uninhabitable discount, or even later demolition automatically proves the property was not suitable for use as a dwelling for SDLT. After Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799, the condition threshold is relatively high, and strong evidence is essential.

Practical Steps

If you are assessing a similar case, the sensible next steps are:

• check the SDLT filing history and confirm whether the earlier claim was withdrawn, refused, or formally determined;
• confirm the completion date and calculate the final date by which any fresh claim must be made;
• gather contemporaneous photographs from the purchase period;
• obtain sales particulars, auction pack documents, surveys, mortgage valuation material, contractor reports and invoices;
• prepare a clear witness statement describing the property’s actual condition at completion;
• obtain an independent statement from a builder, surveyor or engineer dealing specifically with habitability at the effective date;
• include any local authority records, such as council tax decisions, but treat them as supporting rather than decisive evidence; and
• test the facts against the current high threshold under Mudan before submitting anything to HMRC.

Conclusion

If an earlier SDLT uninhabitable property claim was withdrawn and never formally decided, a fresh claim may still be possible. But the real question is not just whether the property was in bad condition. It is whether, on the evidence, it was not suitable for use as a dwelling at the effective date of the transaction. Following Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799, that is now a demanding test.

Legal References Used

• Finance Act 2003
• Finance Act 2003, Schedule 4ZA
• Amarjeet and Tajinder Mudan v The Commissioners for HMRC [2025] EWCA Civ 799
• Mudan v HMRC

This page was last updated on 22 March 2026.

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