L-L-O Contracting Limited & Ors v The Commissioners for HMRC

Case A in paragraph 34A(2)(b) Schedule 10 Finance Act 2003 excludes overpayment relief where excessive SDLT results from failing to claim a relief that had to be claimed in a return or its amendment. Mistake includes an omission caused by ignorance as well as oversight. A taxpayer’s lack of awareness of the relief creates no exception. The statutory claim procedure and its hard-edged time limit preserve certainty and finality in SDLT self-assessment.

The appellants purchased properties between April 2016 and August 2019 without claiming multiple dwellings relief in their land transaction returns or amendments. They later claimed repayment of overpaid SDLT under paragraph 34 Schedule 10 Finance Act 2003. The First-tier Tribunal assumed that they were otherwise entitled to the relief, held that their failures to claim were mistakes within Case A, and struck out the appeals.

The appeal concerned whether ignorance of the availability of multiple dwellings relief meant that no mistake had occurred, leaving paragraph 34 overpayment relief available after the time for amending the returns had expired.

1. Appeals dismissed. The FTT made no error of law in holding that Case A excluded the claims for overpayment relief.
2. Paragraph 34 provides relief for overpaid tax subject to paragraph 34A. Section 58D(2) requires multiple dwellings relief to be claimed in a land transaction return or an amendment. The amendment period is 12 months, whereas paragraph 34B allows four years for an overpayment claim. Reading Case A in that statutory context prevents the longer period from undermining the specific claim procedure.
3. The ordinary meaning of mistake includes an act or omission producing an unwanted result. It does not require prior awareness of the relevant relief. Failure to claim multiple dwellings relief is therefore a mistake whether caused by oversight or ignorance.
4. The contrast with Case C supports that construction. Parliament included an express knowledge qualification in Case C but not in Case A. The difference in wording cannot be rewritten into an exception for taxpayers unaware that a claim could be made.
5. The hard-edged nature of SDLT time limits and the need for certainty and finality supported the conclusion. Candy v HM Revenue & Customs was relevant in recognising those features, although it did not decide the present argument. The Explanatory Notes did not materially support HMRC’s interpretation.
6. The court left open whether a failure to claim in an amended return, where the taxpayer intended to claim but was prevented at the last moment, would constitute a mistake. That question did not arise.

• Upper Tribunal (Tax and Chancery Chamber): dismissed the appeals against the First-tier Tribunal’s decision.
• First-tier Tribunal: in a decision released on 13 October 2023, held that Case A excluded the claims and struck out the appeals for having no reasonable prospect of success.