Two 2026 SDLT Rulings on Garden and Grounds, and Why They Point Different Ways

Two Rulings, Opposite Directions

If a purchase includes land that is not residential property, the whole transaction is charged at the non-residential or mixed rates in Table B of section 55 Finance Act 2003 rather than the residential rates in Table A. On an expensive house that difference is large, which is why the question of what counts as the “garden or grounds” of a dwelling under section 116(1)(b) has become one of the most heavily litigated points in stamp duty.

Two decisions in the first half of 2026 addressed it and reached opposite results. In February, a First-tier Tribunal held that a busy public towpath running through a riverside property in Marlow was not part of the grounds, so the purchase was mixed use and the buyers were entitled to a substantial reduction. In March, the Upper Tribunal held that a man-made stream and a two-acre island were part of the grounds of a Hampshire house, overturned the decision below, and dismissed the taxpayer's appeal.

Read as a pair, they are easy to misread as evidence that these claims are a lottery worth entering. They are not. The two decisions sit at different levels of the tribunal system, and the one that went the buyers' way is the one that carries no precedential weight at all. For background on the classification itself, see our mixed-use property guide.

Brzezicki: The Upper Tribunal Tightens the Test

HMRC v Christopher Brzezicki [2026] UKUT 00125 (TCC) was heard on 1 December 2025 by Judge Swami Raghavan and Judge Mark Baldwin, and released on 18 March 2026.

The property was a six-acre holding on the River Meon in Hampshire, bought on 3 July 2020, with a six-bedroom house converted from a former stable block. A man-made carrier stream roughly six feet wide ran between the garden and a two-acre parcel that the tribunal called the island, reached by two footbridges. The stream had been engineered for brown trout, with a sluice, a waterfall to oxygenate the water, a gravel spawning bed and downstream grilles. At completion it was not being run commercially, though it was still functioning biologically. Paying anglers came in a later season, after the purchase.

The First-tier Tribunal below had been split, and the mixed-use finding survived only on the judge's casting vote. The Upper Tribunal found errors of law, set that decision aside, and remade it. Its conclusion at paragraph 83 was that the stream and island were “undoubtedly part of the grounds”, so the land was entirely residential property and Table A applied.

Three points from the reasoning matter well beyond the facts of this case:

• An internal physical divide does not split a plot. At paragraph 70 the tribunal said that “the presence of a narrow watercourse does not operate to exclude the island from forming part of the garden or grounds”, noting that many residential properties contain streams, ponds, ditches or footpaths. The question is not whether water lies between two parts of land.
• Contiguity is about ownership, not physical features. The tribunal held the FTT was wrong to treat the stream as making the island non-contiguous, where all the land was in common ownership.
• Commercial use is not decisive. This is the point most often reported backwards. The tribunal did not hold that the absence of commercial trout production saved the claim for HMRC. It went further, saying at paragraph 45 that “even if it were established that there had been some historical (or even current) commercial use, that would not force a conclusion that the land could not be grounds”, and at paragraph 77 describing the contrary view as a “flawed assumption”.

That third point is the opposite of the way these cases are often summarised. If you have read that Brzezicki turned on there being no commercial activity, and inferred that commercial activity would have won, the tribunal expressly rejected that reasoning.

Wood: A Towpath Win, and Its Limits

Alan Wood & Anor v HMRC [2026] UKFTT 00265 (TC), case reference TC09791, was heard on 28 January 2026 by Judge Brooks and Member Hunter, and released on 20 February 2026. The second appellant was Elizabeth Veitch.

Mr Wood and Ms Veitch bought a freehold estate in Marlow for £4.5 million, completing on 29 June 2023. It comprised a seven-bedroom house, a garden about 7 metres deep enclosed by a brick wall roughly 1.3 metres high with a single gate, a towpath about 3 metres wide forming part of the Thames Path National Trail, a low chain fence, and a strip of grass on the river bank. They self-assessed and paid £586,250. Their accountants then amended the return on the basis that the towpath was non-residential, stating that the correct liability was £214,500 and that a refund of £371,750 was due.

The tribunal agreed that the towpath was not part of the grounds, and allowed the appeal. What carried it was the sheer volume of use. Mr Wood had set up a video camera on the first floor of the house, recorded the towpath between 6am and 9pm on five days in late May and early June 2025, sampled fifteen minutes at random within each hour, and counted. The resulting average was about 850 users a day.

Three qualifications belong with that result, and they are usually omitted:

• A public right of way alone was expressly not enough. At paragraph 34 the tribunal recorded that a public right of way “does not make it any less the grounds of the House”, and that counsel for the buyers accepted this “as he must”. The case turned on the level of intrusion together with the loss of privacy and security. No threshold number of users was set.
• The 850 figure was unchallenged rather than established. It was the first appellant's own sampling, and HMRC did not contest it. The panel recorded that because the conclusions were not challenged, it did not consider it necessary to view the footage.
• The riverside finding is obiter. Having decided the towpath point, the tribunal said at paragraph 36 that it was “not necessary” to decide whether the riverside strip was part of the grounds, and set out an abbreviated view only because it had heard argument. At paragraph 37 it said it “would have concluded” the riverside was part of the grounds. That is not a finding, and it should not be cited as one.

It is also worth being precise about what the tribunal did and did not order. It allowed the appeal. It did not compute or award a refund. The £214,500 and £371,750 are the figures stated in the accountants' amendment letter and recorded in the findings of fact; the reduction follows mechanically from the appeal succeeding.

Why Brzezicki Outweighs Wood

These two decisions are not equal and opposite. Three things separate them.

The chronology matters more than it first appears. Brzezicki was released 26 days after Wood, so the Wood panel decided without it and never addressed it. Wood was argued on the earlier Upper Tribunal authority alone. Any future panel hearing a similar argument will have to apply Brzezicki, which no one has yet tested against a towpath.

Nor do the two cases meet head on. Brzezicki concerned a private stream and island with no public access. It contains one passing observation about a public path, and it cuts against the taxpayer: the tribunal envisaged land separated from a dwelling by a public path in someone else's ownership that “may still fairly be described as grounds of the dwelling”. So there is no Upper Tribunal authority that a busy public towpath is non-residential, and there is Upper Tribunal authority that third-party rights over land do not by themselves take it out of the grounds.

The Refund You Can Lose by Claiming

The most useful detail in either case is one that almost no coverage mentions, and it is a cost of losing rather than a benefit of winning.

Mr Brzezicki had paid the additional-dwellings surcharge because he still owned his previous home. He then sold that home within the window that would normally have entitled him to reclaim the surcharge. According to the First-tier decision, he was not able to reclaim it, because he had amended his SDLT return to claim the reduced rate applicable to non-residential property. Having chosen the mixed-use route, he lost the mixed-use argument on appeal and appears to have been shut out of a surcharge refund he would otherwise have had.

A speculative mixed-use amendment is therefore not a free option. It can interact with other reliefs you were already entitled to. If you are in the surcharge-refund window, see our refund claim process guide before amending anything.

What This Means If You Are Considering a Claim

Wood is a genuine win and worth knowing about. It is not a green light. Reading it as “my property has a footpath, so I can claim” misreads the case in the specific way the tribunal warned against.

• The existence of a right of way, a track, a paddock boundary or a stream is not by itself an argument. Both decisions say so.
• The exercise is evaluative and fact-specific. Brzezicki weighed a list of factors and reached an overall impression; it did not apply a checklist that a property either passes or fails.
• Evidence carries the argument. Wood succeeded on measured, documented, contemporaneous evidence of intrusion that HMRC chose not to contest. Assertion would not have done it.
• The direction of travel at the binding level favours HMRC. Brzezicki set aside a taxpayer win and narrowed the routes to a mixed-use finding.
• Losing has costs beyond the fee. Interest and penalties can follow an unsuccessful claim, and as Brzezicki shows, an amendment can forfeit a separate relief.

The Law Society has separately warned that some firms continue to encourage buyers to make unfounded SDLT refund claims. Where a claim is genuinely arguable it is worth taking properly, and where it is not, an amendment is an invitation to an enquiry.

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