Mark McLaughlin looks at claims for ‘multiple dwellings relief’ from stamp duty land tax when a main residence is bought with a ‘granny flat’.
Granny flats are popular these days. The term ‘granny flat’ is broadly shorthand for part of a main house (usually an annexe) made into self-contained accommodation suitable for an elderly relative.
SDLT rates
For stamp duty land tax (SDLT) purposes, the existence of a granny flat potentially reduces the amount of SDLT payable on the whole property (NB this article focuses on properties in England and Northern Ireland; separate rules apply in Scotland and Wales).
When buying residential property (over £250,000), SDLT is generally payable on increasing portions of the property price, currently at 5% on the portion of the purchase price from £250,001 to £925,000; at
