Tax bill for £1.5m Hayling Island property as annexe not mixed use

Annexe of a five-bed house in Hayling Island cannot be used as a separate dwelling as it does not have amenities fit for living and ‘not reasonable’ for guests to use the property’s pool room

Hani and Diana Gabra bought The Willows in Hayling Island, near Chichester, for £1,569,000 on 11 June 2021, believing that they had purchased two separate dwellings as there was the property, and a separate office and games room, which they described as the annexe.

The couple claimed MDR for £58,657, reducing their total bill of £87,150, to only £28,493.

As well as the games room the property also features an outdoor swimming pool, horse stables, a tennis court, and a plot of 1.7 acres.

At the time of the purchase the annexe did not have the suitable amenities to be classed as a dwelling, such as a bathroom and a kitchen.