Taxpayer recovers almost 2 million in successful SDLT appeal

In Christian Peter Candy v HMRC [2025] UKFTT 416 (TC), the First-tier Tribunal (FTT) confirmed that the taxpayer was entitled to bring a claim for repayment of stamp duty land tax (SDLT) outside the usual 12-month window for amending a return, by relying on paragraph 34, Schedule 10, Finance Act 2003.

Background

Mr Candy initially incurred a SDLT liability of £1.92m, arising from the substantial performance of a contracted-out lease in relation to a property known as Gordon House (a substantial house with associated buildings and a garden). This liability was declared in a land transaction return and paid. Subsequently, the contract was extinguished through novation and was not carried into effect. This occurred after the expiry of the standard 12-month period allowed for amending a return.

Mr Candy then made two alternative claims for SDLT relief. One under section 44(9), Finance Act 2003 (the section 44 claim) and another for overpayment relief under paragraph 34, Schedule 10, Finance Act 2003 (the overpayment relief claim). 

Different statutory time limits apply to each claim. A claim under section 44 must be made by amending the land transaction return within 12 months of its filing date, whereas a claim under paragraph 34 must be submitted within four years of the transaction date and must not be made by way of a land transaction return.

The section 44 claim was submitted to HMRC outside the 12-month amendment window and the overpayment relief claim was made within the four-year time limit. It was common ground between the parties that had the section 44 claim been made within time, SDLT relief would have been available to Mr Candy.

In earlier proceedings concerning the section 44 claim, the Court of Appeal had held that the claim was invalid due to it being time-barred (Christian Peter Candy v HMRC [2022] EWCA Civ 144). Following that decision, the stay which had been in place in relation to the alternative overpayment relief claim was lifted, and it was that claim which was considered by the FTT in this decision.

FTT decision 

The appeal was allowed. 

The question for determination by the FTT was whether overpayment relief under paragraph 34 was available in circumstances where SDLT would have been repayable under section 44(9), if a claim under that provision had been brought in time.

HMRC argued that the overpayment relief claim should fail because section 44(9) provides an alternative statutory remedy which prevents paragraph 34 from applying. In effect, HMRC argued that section 44 constitutes an exclusive remedy, and allowing a claim under paragraph 34 would undermine the statutory time limit imposed by section 44(9).

Mr Candy contended that paragraph 34 operates as an independent provision, intended as a 'backstop' remedy where relief is not available under any other statutory provision.

In the view of the FTT, Mr Candy was entitled to bring the overpayment relief claim and was not prevented in doing so by the operation of section 44(9). 

In reaching its conclusion, the FTT considered the legislation and the Explanatory Notes which introduced paragraph 34 as well as HMRC's Technical Note which, although not having the same weight, helped put the provision in context. 

The FTT concluded that the purpose of paragraph 34 is to provide a final statutory remedy when no other remedy exists and is a last resort or back-stop, where all other statutory relief provisions have been exhausted. The FTT noted that paragraph 34 had undergone legislative change which widened its application from covering overpayments in cases of mistake to covering, subject to certain limitations, any situation in which a person overpays or is over-assessed an amount in respect of SDLT.  In its view, section 44(9) does not prevent SDLT relief being claimed under paragraph 34, if the claimant satisfies the conditions referred to in that paragraph. The FTT considered that such an interpretation did not undermine the operation of section 44(9) because such an interpretation did not require a divergence from the natural meaning of the statutory language and was consistent with the architecture of the SDLT framework and the purpose of the legislation, as indicated in the Explanatory Notes and Technical Note. 

Comment

The FTT's interpretation of paragraph 34 will be welcomed by taxpayers who are in a similar position to Mr Candy and who are seeking to claim SDLT relief outside the 12-month amendment window.

The FTT's analysis of paragraph 34 may also have broader application to taxpayers who are seeking overpayment relief in relation to other taxes.

The decision can be viewed here.