In L-L-O Contracting Ltd & Ors v HMRC [2025] UKUTT 00127, the Upper Tribunal (UT) agreed with a previous ruling that the failure to claim Multiple Dwellings Relief (MDR) by the statutory deadline was a 'mistake'.
L-L-O Contracting Ltd (LLO) (and nine others) submitted land transaction returns and paid Stamp Duty Land Tax (SDLT) on the purchase of various residential properties. They failed to claim Multiple Dwellings Relief (MDR) at the time of submission because they were unaware that the relief was available to them.
- LLO then submitted Overpayment Relief claims after the 12-month filing deadline for submitting amended SDLT returns had expired.
- HMRC rejected the claims on the basis that they were not required to give effect to claims that were made as a result of a mistake.
- LLO appealed to the First Tier Tribunal (FTT).
The issues that were raised in the FTT hearings were:
- Issue 1(a): Whether Overpayment relief can be made as a claim in respect of MDR.
- Issue 1(b): Whether the person who failed to amend his return for MDR has 'overpaid' any SDLT.
- Issue 2: Whether HMRC were not liable to give effect to a repayment of SDLT because a failure to claim by the statutorytime limit in the form required by the legislation was a 'mistake' in terms of overpayment relief.
Paragraph 34A Schedule 10 Finance Act 2003 highlights provisions where HMRC are not liable to give effect to repayments. Case A specifically determines that overpayments should not be made where a mistake has been made. The FTT agreed with HMRC that a mistake had been made.
The FTT rejected LLO's argument that failing to submit a return due to ignorance of the law is not a mistake.
LLO appealed to the Upper Tribunal (UT), which found that:
- The provisions at Schedule 10 must be read in context as a whole, and Parliament's intention of the wording must be given consideration.
- If LLO's interpretation of the Case A provision were correct, this would allow taxpayers who were ignorant of the relief a further three years to make a claim after the 12-month deadline already offered to make amendments.
- Parliament provided a 12-month period to submit amended returns. There is no indication that Parliament intended to grant an extension under Case A to taxpayers ignorant of the law during the 12-month window.
- A mistake can happen due to ignorance of the law.
- The purpose of Case A was clearly intended to ensure that time limits for making amendments were not undermined.
- Where a mistake consists of a failure to claim for whatever reason, the relief is simply not available to the taxpayer.
The appeal was dismissed.
Useful guides on this topic
Overpayment Relief
What is Overpayment Relief? When can you claim Overpayment Relief? What are the conditions for a claim for Overpayment Relief? What are the time limits for a claim for Overpayment Relief?
Time limits for tax assessments, claims and refunds
What are the time limits for claiming a tax refund? How far can HMRC go back and raise an assessment? How many years back can a taxpayer appeal? What are the time limits for correcting a tax return?
SDLT: Amending returns & refunds
How do I amend an SDLT return? When can I amend an SDLT return? How do I claim an SDLT refund? How do I deal with contingent consideration?
SDLT: Stamp Duty Land Tax, start here
What is SDLT? What are the SDLT rates? What is exempt from SDLT? What reliefs are available? When are returns due? When can you amend a return?
SDLT: Multiple Dwellings Relief (MDR)
What is Multiple Dwellings Relief (MDR) for Stamp Duty Land Tax purposes? When does it apply and how is it claimed?
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