Access to utilities was not the deciding factor

The taxpayer bought an extended dormer style bungalow which was detached with gardens at the front and rear. A door to the left gave access to the main accommodation and a separate door provided entry to an annex. The annex was narrow but contained a living room bathroom bedroom and kitchen. The overall impression of the property was a single house with two wings – each with similar front doors. There was no interconnecting door between the main house and the annex and they were listed separately for council tax. They had separate heating systems although both boilers and fuse boxes were in the annex.

The taxpayer claimed multiple dwellings relief applied. HMRC disagreed.

The taxpayer appealed.

The First-tier Tribunal considered first HMRC’s contention that one of the tests for multiple dwellings relief was whether a third party would buy one of the properties separately from...