The case at the First Tier Tribunal (FTT) centred around a dispute with HMRC over whether part of the 11-bedroom property was dedicated to commercial use.

At tribunal, the property owner Anne-Marie Hurst disputed a closure notice dated 17 August 2022, issued by HMRC under paragraph 23, Schedule 10 of Finance Act 2003, for underpaid stamp duty land tax (SDLT) amounting to £47,750.

HMRC concluded that the residential rate of SDLT was due on the purchase of Sortridge Manor, a £1.8m property in Devon, not the original non-residential rate paid on 21 August 2021 when the purchase transaction was completed and filed on the basis that only part of the property was used for residential purposes.

HMRC opened an enquiry into the return on 26 April 2022 arguing that the property was purely residential and disputing the appellant’s assertion that part of the property was used as a ‘hotel or inn or similar establishment’ as defined in section 49I Taxes Management Act 1970 as there was ‘insufficient evidence’.

It also