Property Purchase Qualifies for Tax Relief, UK Court Rules

The arm’s length principle isn’t a relevant test in determining whether the purchase of properties qualifies for tax relief intended for separate dwellings, a UK court ruled.

The First Tier Tribunal ruled Monday that His Majesty’s Revenue and Customs’ rejection of a taxpayer’s multiple dwellings relief claim under the principle should be reversed since the intent of the purchase doesn’t have to be considered when claiming the relief.

The case centers on a taxpayer’s 2022 purchase of a property consisting of a main house and an annex for £895,000 in 2022, for which he paid almost £35,000 in stamp duty ...