Fish Homes v HMRC

In Fish Homes v HMRC [2020] UKFTT 180 (TC) (8 April 2020)  the First-tier Tribunal (FTT) held that a flat with defective cladding was suitable for use as a dwelling for the purposes of the 15% rate of SDLT. Although the taxpayer carried out a property rental business and the flat was acquired for the purposes of that business a non-qualifying individual was permitted to occupy the flat within three years of the effective date of acquisition so relief from the 15% rate was clawed back. 

The taxpayer company (F) acquired a vacant flat for the purposes of its property rental business. Following completion it discovered that it could not let the flat on a formal tenancy because the block was rendered with dangerous cladding. While remedial work was carried out the daughter of F’s directors and majority shareholders and her friend occupied the flat. After that work had been finished the daughter and friend...