February 2, 2026
SDLT
Freya Grant
The First-tier Tribunal has delivered a rare taxpayer success in the mixed-use SDLT arena, holding that 150 acres acquired with a West Sussex country estate were not wholly residential: Goudman-Peachey v HMRC.
Large areas of land were used for independent, self-standing non-residential purposes, qualifying the acquisition for mixed-use SDLT rates and overturning an additional SDLT assessment of around £477,000 raised by HM Revenue & Customs.
The decision is a timely reminder that extensive or attractive land does not automatically form part of a property’s residential “grounds”. SDLT turns on function and use, not scenery.
It was accepted that the main house at Woodmancote Place was a dwelling. The dispute concerned whether the surrounding land constituted residential garden and grounds.
The evidence showed a functioning rural estate at completion rather than a high-value home with amenity land. Multiple non-residential uses co-existed alongside the residential occupation, each operating independently.
Around 60 acres were operated as a commercial deer enterprise, established several years before the purchase. The purchasers acquired the existing deer herd under a written agreement entered into immediately before completion and retained the professional deer manager already in place. Drone footage and mapping demonstrated clearly delineated areas separate from the formal gardens, supporting the finding of an ongoing commercial business.
A further 60 acres were used for sheep grazing by a local farmer. Although the arrangements were informal at completion, the Tribunal was persuaded by livestock numbers, agricultural classifications, infrastructure and clear physical separation from the house that the use was genuine and ongoing.
Other land was used for arable farming and hay production, including maize grown by a third-party farmer. While such activities are often dismissed as land maintenance, the scale and structure of the operations here were sufficient to demonstrate commercial use.
Further weight was added by the land’s registration under the Rural Payments Agency Basic Payment Scheme and Environmental Stewardship Schemes, providing objective evidence of sustained agricultural activity.
The Tribunal also considered factors beyond commercial farming.
Part of the estate was subject to a 99-year lease to Rampion Offshore Wind Ltd for underground cabling. This imposed ongoing obligations on the landowner, including soil replacement and land management, which the Tribunal treated as an active infrastructure burden at completion.
In addition, extensive public rights of way crossed the land. Compliance with local authority requirements imposed continuing obligations and undermined the argument that the land primarily benefitted the residence.
HMRC argued that the land enhanced the enjoyment of a country house and therefore formed part of its residential grounds. While some areas clearly did, the Tribunal rejected the idea that enhancement alone is decisive where land is simultaneously used for independent commercial or agricultural purposes.
The key question is whether, at completion, the land is functionally and economically part of the residential use of the dwelling or whether it serves a separate and self-standing purpose. In this case, large areas of the estate clearly fell into the latter category.
Goudman-Peachey confirms that even substantial and scenic estates can qualify for mixed-use SDLT where land is genuinely used for farming, grazing or infrastructure. SDLT turns on substance, not appearance.
Successful cases will usually involve clearly identified non-residential land, contemporaneous arrangements, third-party evidence and consistency across documentation and visual material. While some arrangements here were informal, formal documentation remains advisable.
This decision highlights the importance of early analysis when acquiring rural property. Where professional advice is taken before adopting a mixed-use filing position, purchasers are typically protected from penalties even if HMRC later challenges the classification.
At Bell Howley Perrotton LLP, Amanda Perrotton and Simon Howley regularly advise on complex SDLT classifications, including mixed-use claims for rural estates. We support clients both before completion and in managing HMRC enquiries and disputes.
