Thomas Kozlowski appealed against a closure notice issued by HMRC for the assessment of SDLT for £134,250.

According to HMRC, the property purchased by Kozlowski was wholly residential and he was not entitled to calculate the SDLT due on the basis that the property was mixed-use.

Kozlowski bought a property on Esher Green, Esher on 12 January 2022 for a total of £2.1m. On the same day, he let a garage which formed part of the property to S4 Financial Limited (S4) for storage purposes at a rent of £50 a month.

His solicitors then submitted an SDLT return on the basis that the property was wholly residential and paid the residential rates of SDLT. As Kozlowski owned another residential property, the purchase was a ‘higher rates transaction’ within schedule 4ZA and attracted the higher rates of SDLT.

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