The Spring Budget 2023 brought the announcement of the abolition of Multiple Dwellings Relief (MDR). As of now, this change affects transactions completing or substantially performing on or after 1 June 2024.
Property purchasers who bought more than one dwelling could previously apply MDR relief. This relief was applicable when a transaction or a series of linked transactions included freehold or leasehold interests in more than one dwelling. This relief was a significant tax benefit that could significantly lower the SDLT due. However, the government believed that MDR was no longer cost-effectively achieving its original objectives. As a result, they have abolished the relief.
For transactions before 1 June 2024, MDR is still claimable.
If you’re buying more than one dwelling and your transaction (or a series of linked transactions) includes freehold or leasehold interests in more than one dwelling, you can claim Multiple Dwellings Relief. This is applicable to transactions where:
- the exchange of contracts occurred on or before 6 March 2024;
- substantial performance of contracts happened before 1 June 2024; and
- completion of contracts took place before 1 June 2024.
However, keep in mind that various exclusions apply to these transactions. It’s always a good idea to consult with a tax professional to understand these exclusions and how they might affect your specific situation. This way, you can make the most informed decision possible.
