HMRC: SDLT Multiple Dwellings Relief Withdrawal June 2024

• Multiple Dwellings Relief (MDR) for Stamp Duty Land Tax was withdrawn starting June 1, 2024.
• New thresholds and rates for residential property, including First-Time Buyers’ Relief, became effective on April 1, 2025.
• First-time buyers can claim relief for main residences up to £500,000, using relief code ‘32’ on their SDLT return.
• Updated guidance also covers shared ownership properties, seeding relief for RIFs, and relief for social housing providers.
• SDLT is charged by HMRC on UK property transactions above certain thresholds, with specific codes required to claim reliefs.

A pivotal change in the recent HMRC updates is the cessation of Multiple Dwellings Relief (MDR) for Stamp Duty Land Tax, which will no longer be available for transactions completing on or after June 1, 2024.

HMRC has announced significant adjustments to Stamp Duty Land Tax (SDLT) reliefs, most notably the withdrawal of Multiple Dwellings Relief (MDR) which became effective from June 1, 2024. This change is part of a series of updates to SDLT guidance, which also includes revised thresholds and rates for residential properties that came into effect on April 1, 2025. The comprehensive updates aim to clarify existing provisions and introduce new rules for various property transactions across the UK.

Beyond the MDR withdrawal, the guidance has been refined for several other relief categories. This includes updated information for first-time buyers, particularly concerning the maximum property value eligible for relief, and new details for those purchasing shared ownership properties. Additionally, specific provisions for registered providers of social housing and certain investment funds have been introduced or clarified, reflecting an ongoing effort to ensure the SDLT framework remains current and applicable to diverse property scenarios.

A pivotal change in the recent HMRC updates is the cessation of Multiple Dwellings Relief (MDR) for Stamp Duty Land Tax, which is no longer available for transactions completing on or after June 1, 2024. This relief previously allowed purchasers acquiring two or more dwellings in a single transaction, or linked transactions, to calculate SDLT based on the average value of the dwellings, potentially reducing the overall tax liability. The withdrawal signifies a shift in the government's approach to taxing multi-property acquisitions.

The updated information from HMRC specifically supports this withdrawal, indicating that the department has prepared its guidance to reflect the change. While the source does not detail the rationale behind the withdrawal, its implementation date provides a clear deadline for property investors and developers who may have previously relied on MDR for their acquisition strategies. This move aligns with broader efforts to streamline tax reliefs and ensure their intended application.

First-time buyers of residential properties will find updated guidance regarding their eligibility for Stamp Duty Land Tax relief. For those intending to occupy the property as their main residence, relief can now be claimed if the purchase price does not exceed £500,000. This specific threshold applies to purchases made under the updated rules, which saw residential property thresholds and rates change on April 1, 2025. It is important to note that if a first home was purchased before this date, different relief rates for first-time buyers would apply. To claim First-Time Buyers’ Relief, individuals must use relief code ‘32’ on their SDLT return.

Relief provisions have also been enhanced for first-time buyers acquiring shared ownership properties. Such buyers can claim relief either by making a market value election or by opting to pay SDLT in stages. Similar to other first-time buyer provisions, different relief rates are applicable if the shared ownership property was purchased before April 1, 2025. Furthermore, the guidance now includes details on claiming relief for Local Government Pension Schemes, clarifies seeding relief for Reserved Investor Funds (RIFs) requiring code ‘38’ on the SDLT return, and provides information on SDLT relief within Freeport tax sites, alongside new details for registered providers of social housing and 'relevant housing providers'.

Stamp Duty Land Tax is levied by HMRC on property transactions in the UK when the property's value surpasses predefined thresholds. While this tax is generally applicable, various reliefs exist to either reduce the payable amount or exempt certain transactions entirely. To access these reliefs, taxpayers are required to complete an SDLT return, even if no tax is ultimately due, and must accurately enter the corresponding relief code from a drop-down list in box ‘9’. Failure to meet eligibility criteria for a claimed relief could result in penalties from HMRC.

The SDLT landscape has seen several adjustments over time. For instance, the consideration for residential properties and standard residential purchases was altered on September 23, 2022. Historically, the government also temporarily increased the nil rate bands of residential SDLT, raising them from £125,000 to £500,000, and extended purchase deadlines for reduced rates. It is also important to remember that as of April 1, 2018, SDLT no longer applies to property transactions in Wales, which instead fall under the Land Transaction Tax administered by the Welsh Revenue Authority.

Source: Original reporting via GOV.UK guidance updates