What is Multiple Dwellings Relief- And How Can I Claim MDR?
Do you own multiple properties? Are you looking for a way to reduce your tax liability? If so, you may be eligible for multiple dwellings relief (MDR). MDR is a relief available to landlords who own multiple properties. It allows you to claim a deduction on your taxes for the costs of repairs and maintenance. However, MDR can be complicated to file for and it is important to have a professional agency like Stamp Refunds help you with the process. In this post, we will explore what MDR is, how to file for it, and why you need a professional agency like us to help you with the process.
What are the Benefits?
Multiple Dwellings Relief (MDR) is a relief from stamp duty land tax (SDLT) that applies when you purchase multiple dwellings, such as flats in a block or apartments in a purpose-built development.
The main reason why you would claim MDR is to avoid paying SDLT on each individual dwelling purchased. Without MDR, you would have to pay SDLT on the full value of each property purchased.
To claim MDR, you must purchase at least two dwellings as part of the same transaction. The dwellings can be located anywhere in England or Wales and must be intended for use as separate residences.
If you do qualify for MDR, the amount of relief available depends on the number of dwellings being purchased:
2 dwellings – 3% relief
3-4 dwellings – 4% relief
5 or more dwellings – 5% relief
The maximum amount of relief that can be claimed is £250,000 per transaction.
How does it work?
When you purchase a property that is classified as a multiple dwelling, you are eligible for what is called Multiple Dwellings Relief. This relief allows you to pay a lower rate of Stamp Duty Land Tax (SDLT) on the purchase price of the property. In order to receive this relief, you must file a claim with HMRC within three months of completion of the purchase.
The amount of relief you are entitled to depends on the number of units in the property. For properties with two or more units, the relief is calculated by multiplying the standard rate of SDLT by the number of units in the property. For example, if you purchase a property with four flats for £500,000, your total SDLT bill would be £10,000 instead of £20,000 if you did not file for Multiple Dwellings Relief.
If you are planning on purchasing a multiple dwelling or have already done so, it is important to use a professional agency like Stamp Refunds in order to ensure that you receive the full amount of relief to which you are entitled.
What are the benefits of multiple dwellings relief?
When it comes to tax, there are many different types of relief that can be claimed. One such relief is multiple dwellings relief, which can be a great way to reduce the amount of tax you owe on your property.
Multiple dwellings relief allows you to claim a reduction in the amount of Stamp Duty Land Tax (SDLT) you owe when you purchase a property that contains two or more homes. This could be a house with flats, or a block of flats. In order to claim the relief, you must own the property for at least six months and use it as your main residence.
If you’re thinking about purchasing a property that contains multiple homes, it’s definitely worth considering claiming multiple dwellings relief. A professional agency like Stamp Refunds can help you with the process and ensure that you get the maximum amount of relief possible.
Why you need a professional agency like Stamp Refunds
If you own multiple properties that you rent out, you may be eligible for multiple dwellings relief (MDR). MDR allows you to pay a reduced rate of stamp duty land tax (SDLT) on your second property.
To qualify for multiple dwellings relief, the properties must be:
– Let on separate leases
– In different local authority areas
– Used as your main residence for at least part of the year
If you meet these criteria, you can claim multiple sewllings relief by following the steps below:
1. Calculate the SDLT due on your second property using the standard rates.
2. Subtract 3% from this amount to get the MDR rate.
3. Pay the reduced amount of SDLT.
You can claim MDR when buying a second property or when inheriting a property that meets the criteria above. You must file a claim with HM Reven’e and Customs within 14 d’ys of completion if you are buying a property, or within 30 days if you are inheriting one.
Stamp Refunds is a professional agency that can help you with filing for multiple dwellings relief. We have a team of experts who are familiar with the process and can help make sure that everything is done correctly. Contact us today to learn more about how we can help you save money on your second property purchase.