Mixed-use headaches and hurdles

Hillier Hopkins LLP

Chartered Accountants & Tax Advisers

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Three cases, Hyman, Pensfold and Goodfellow, were unsuccessful in claiming a mixed-use classification at the First Tier Tribunal. As the cases were similar a joint claim was put forward to the Upper Tier Tribunal (“UTT”)

  • The Hymans’ property included a house, barn and 3.5 acres.
  • The Goodfellow property included a house, home office over the garage, stables and 4.5 acres; and
  • The Pensfold property included a house with 27 acres.

The key point of contention was to determine whether the land sold together with the house was, or formed part of, the garden or grounds of the house.

Upper Tribunal findings

The UTT considered the arguments put forward in order classify garden and grounds, including applying HMRC’s guidance for calculating the size of a garden for Capital Gains Tax purposes. However, they were not of the view that the arguments relying upon the heritage of the wording were persuasive. Although HMRC argued against their own guidance the UTT preferred the arguments of HMRC.


Purchasers of properties with substantial grounds are likely to continue to be subject to scrutiny if they seek to argue a mixed-use classification.

The persuasive cases will be those with pronounced non-residential elements such as business premises or commercially farmed agricultural land.

Mixed-use purchases can be a complex area. Everyone’s situation is different and getting advice that is tailored to your unique situation can ensure that your affairs are as efficient as possible. We offer a free initial consultation, so if you would like to speak to Natasha Heron , please get in touch with her on +44(0)330 024 3200 or email hi@hhllp.co.uk.

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Natasha Heron

Natasha is a member of the ICAEW as a qualified auditor and the Chartered Institute of Taxation, specialising in indirect taxes. Natasha has developed a specialism as an adviser on the Stamp Duty Land Tax implications of property transactions.

Contact Natasha at Natasha.Heron@hhllp.co.uk or on 01923 634460