Grant of planning permission does not justify multiple dwellings relief

The taxpayers each acquired property over which planning permission had been granted for the construction of multiple dwellings before the effective date of each transaction. The dwellings were built in line with the planning permission. The companies claimed multiple dwellings relief on the basis that the existence of planning permission satisfied FA 2003 Sch 6B para 7 ie that a building counts as a dwelling for the purposes of multiple dwellings relief if it is in the process of being constructed or adapted for such use. AKA had undertaken some initial work on the site and argued that this was part of the construction process.

HMRC refused the claim and the First-tier Tribunal dismissed the taxpayers’ appeal.

The Upper Tribunal said the grant of planning permission for the construction of dwellings on bare land was not in itself enough to satisfy the requirements of para 7(2)(b) because ...