By Tom Bloomfield.
This week, a canny contact of mine alerted me to a significant stamp duty saving he was able to make when purchasing a house that included a granny annex within its grounds.
The relief can apply to purchases where one or more buildings within the grounds can be classified as dwellings. The more dwellings the greater the saving but it only applies where the principal home constitutes at least two thirds of the total value.
The legislation was designed so that multi-generational families choosing to live together in a property with annexes are not taxed in the same way that one wealthier family would be for an equivalent value purchase of a conventional single dwelling. However, there appears to be no requirement to produce an actual granny (or similar).
If you are considering a purchase with an annex included be sure to ask your solicitor to check the eligibility of you and the property concerned. For context and motivation, my firm has one such contender for sale at present (and two about to launch for sale) which would produce an average saving between them of around £20,000.
As well as producing a saving for buyers, this is a marketing opportunity that will benefit estate agents and vendors indirectly.
Government Guidance: Stamp Duty Land Tax: relief for land or property transactions – GOV.UK