Main house and annexe are not separate dwellings

The taxpayers bought a property which comprised a period cottage with an extension built in the 1960s. The main cottage contained an annexe. Their intention was to live in the cottage with their children and for the wife’s parents to move in the annexe. They claimed multiple dwellings relief on the basis the main house and the annexe were separate dwellings. The taxpayers supported their claim saying the annexe had a separate kitchen its own entrance and that internal doors could shut off the main residence. It did not have its own bathroom.

HMRC refused the claim saying the dwellings were not independent of each other because of the lack of a bathroom in the annex.

The First-tier Tribunal noted that it had to consider the suitability for a given use at the time of the transaction. A dwelling had to cater for a person’s living needs – to sleep ...