In the recent case of Alan Wood & Elizabeth Veitch v HMRC [2026] the First tier Tribunal (Tax) considered what counts as ancillary “grounds” to a dwelling for Stamp Duty Land Tax (SDLT) Purposes.

What are the facts of the case?

The purchasers appealed against HMRC’s rejection of their amended SDLT return claiming Mixed-Use treatment of a right of Way. They argued that the busy public Thames Path towpath running across their Marlow estate was non residential, so the transaction should be treated as mixed use. The Tribunal agreed: the towpath—used by around 850 people daily, separated from the house and garden by a brick wall, and offering no privacy or control so did not form part of the dwelling’s garden or grounds under s116 Finance Act 2003.

Why is this important?

For a property worth £4.5 million, the financial impact of mixed use SDLT treatment is substantial. In the Wood & Veitch case, reclassifying the transaction as mixed use reduced the SDLT liability by £371,750, reflecting the significantly lower non residential SDLT rates compared with the residential rates.

Is this a change to the current law?

The decision expands or clarifies the Upper Tribunal’s approach in HMRC v Suterwalla [2024] UKUT 188 (TCC), where a paddock bought with a house was held not to be part of the dwelling’s garden or grounds.

Key indicators there included that the land was:

• held under a separate title;
• not close to or visible from the house;
• physical separation (hedge/gate); and
• was not supporting the dwelling nor forming an integral part of it – ie had no ‘functional connection’

When is Mixed-Use Treatment beneficial?

With the current SDLT rate bandings, savings apply to properties over £925,000 meaning it can be particularly relevant to farms, rural holdings, and country estates, where substantial parcels of land may be physically separate, used for distinct purposes, or subject to public or private rights of way. The principles in Suterwalla—including separate titles, lack of visibility from the house, and functional independence—mean that such properties may be more likely to qualify for mixed use treatment where the facts support it.