August 5, 2026
Solicitors
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Decision: HMRC v Christian Peter Candy [2026] UKUT 282 (TCC)
Tribunal: Upper Tribunal (Tax and Chancery Chamber); decision dated 27 July 2026
Issue: Whether section 44(9) FA 2003 prevented a paragraph 34 overpayment-relief claim after the ordinary amendment period had expired
Outcome: HMRC’s appeal was dismissed. Section 44(9) does not, by itself, preclude the separate paragraph 34 route
Practical significance: A closed return-amendment window may not end the repayment analysis, but the four-year time limit and paragraph 34A exclusions remain critical
Under section 44(4) Finance Act 2003, a land contract may become chargeable to SDLT before legal completion if it is substantially performed. This may occur, for example, where the purchaser takes possession of the whole or substantially the whole of the property, or pays a substantial amount of the consideration.
Section 44(9) provides for repayment where the substantially performed contract is subsequently rescinded or annulled, or is otherwise not carried into effect. It also states that repayment must be claimed by amending the land transaction return.
The practical difficulty is that the event giving rise to repayment may occur only after the ordinary 12-month amendment period has expired. That was the central problem in HMRC v Candy.
Mr Candy had paid £1.92 million in SDLT following substantial performance of a contract concerning a long lease of Gordon House in Chelsea. The contract was subsequently novated and was not carried into effect in his favour.
His attempt to recover the tax through section 44(9) was defeated because the amendment period had expired. He therefore relied separately on the overpayment-relief provisions in paragraph 34, Schedule 10 FA 2003.
HMRC maintained that the mandatory wording of section 44(9) meant that repayment could be obtained only by amending the return. On that analysis, paragraph 34 could not provide an alternative route.
The Upper Tribunal dismissed HMRC’s appeal. It held that overpayment relief is a separate statutory remedy with its own requirements, procedures and time limit. The requirement in section 44(9) to amend the return governs a repayment claim made under that subsection; it does not, by itself, exclude a claim under paragraph 34.
The Tribunal accepted that paragraph 34 can operate as a remedy of last resort where the return can no longer be amended. Such a claim is subject to the separate four-year time limit in paragraph 34B, calculated from the effective date of the transaction.
The judgment must be read carefully. The Upper Tribunal did not decide that every taxpayer in this position will necessarily obtain repayment. It decided the particular legal question raised by HMRC: whether section 44(9) automatically precludes a paragraph 34 claim. It does not.
A claimant must still establish the requirements of paragraph 34 and address the exclusions in paragraph 34A. The nature and timing of the original transaction, the reason the contract was not carried into effect, and the taxpayer’s knowledge and earlier opportunities to claim may all require detailed consideration.
Where a contract has been substantially performed but later fails, the SDLT consequences should be reviewed immediately. The transaction file should preserve:
• the original contract and land transaction return;
• evidence establishing the date and nature of substantial performance;
• any rescission, termination or novation documentation;
• evidence showing precisely how and when the original contract ceased to be carried into effect; and
• a clear chronology of communications with HMRC.
If the amendment period remains open, the section 44(9) procedure should be followed without delay. If it has expired, Candy means that paragraph 34 should be considered rather than assuming recovery is impossible.
The case also demonstrates why SDLT advice should not necessarily end when the original return is submitted. Changes to the contractual route can create fresh filing, repayment and evidential issues long after the effective date.
Candy provides a valuable statutory safety net where the event giving rise to repayment occurs too late for the original return to be amended. It does not remove the statutory conditions or extend the four-year longstop.
The practical message is measured but important: a closed amendment window may not be the end of the analysis, but prompt specialist review remains essential.
HMRC v Christian Peter Candy [2026] UKUT 282 (TCC) — full Upper Tribunal decision
Decision dated 27 July 2026; published 28 July 2026. HMRC’s appeal was dismissed. No further appeal had been publicly confirmed as at 5 August 2026.
This article provides general information only and does not constitute advice on any particular transaction. Specific advice should be obtained on the facts and applicable statutory time limits.
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