SDLT higher rates: additional dwellings - MOD Future Accommodation Model

By Technical Team on 29 Jul 2019

The joint STPG and CIOT comments sent to HMRC on SDLT higher rates: additional dwellings - MOD Future Accommodation Model.

Our submission is available to view here.


Response from HMRC

“HM Government does not consider that there is an anomaly in the legislation. The SDLT provisions have been considered by HMRC, HMT and MoD and all departments are content that the legislation delivers its intended policy effects. The policy aim for job-related accommodation relief for CGT purposes is to allow CGT liability on disposal of a main residence to be apportioned to recognise situations where someone is obliged temporarily to live away from that main residence. By contrast, the policy driver for the higher rates of SDLT is to deter ownership of multiple residences at the same time, as that reduces the availability of homes for purchase. The Government doesn’t consider that latter aim to be in conflict with MoD’s Future Accommodation Model or with the Forces Covenant, in that the SDLT provisions do not put forces personnel at any disadvantage compared to a member of the general public.  

More generally, benefits already exist in the tax system for service personnel in recognition of the specific circumstances faced by members of the Armed Forces. For example, there is no income tax or National Insurance contributions on the Operational Allowance for those assigned to dangerous locations, the Continuity of Education Allowance, payments for Council Tax in certain circumstances, and lump sum payments provided through the Armed Forces Early Departure Scheme, which provides support for service personnel in resettling into civilian life. In addition, service personnel are not taxed on the accommodation provided to them. In the future, the Ministry of Defence also intends to provide members of the Armed Forces with a new accommodation allowance to help them rent or maintain accommodation in the private housing market in the United Kingdom. The Government has also legislated to provide an exemption for these payments”.

Technical Team