Overview

The rate of stamp duty land tax for residential property transactions having an effective date on or after 6 April 2011 and a value of more than £1m will rise to 5%, while the rate for equivalent commercial property remains at 4%.

Given this disparity, whether property can properly be regarded as commercial or residential will have greater significance for developers.

HMRC has not published any guidance on when a building will be ‘suitable for use’ as a dwelling, so it will be a question of fact in each case. But it should be possible to argue that a building which has been derelict for a number of years would not be ‘suitable for use’ as a dwelling. Shoosmiths has the details.