Ian Sinclair & Anor v The Commissioners for HMRC [2026] UKFTT 798 (TC)

[2026] UKFTT 00798 (TC)Case No TC 09898
FIRST-TIER TRIBUNAL
TAX CHAMBER
Hearing Heard on: 5 May 2026Date Judgment date: 29 May 2026
By remote video hearing
Appeal reference: TC/2025/02049
Keywords
Before
TRIBUNAL JUDGE BOWLERJANE SHILLAKER
Between
IAN SINCLAIRAppellantDIANA CHILVERSAppellantTHE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMSRespondentRepresented by Ian Sinclair acting as litigant in person for AppellantFiona Man, litigator of HM Revenue and Customs’ Solicitor’s Office for RespondentsDECISION

Introduction

[1]At the request of the Appellants and with the consent of the Respondents (“HMRC”) the form of the hearing was V (video) using the Teams platform.[2]Prior notice of the hearing had been published on the gov.uk website, with information about how representatives of the media or members of the public could apply to join the hearing remotely in order to observe the proceedings. As such, the hearing was held in public.[3]In short, the dispute before us concerns the correct stamp duty land tax (“SDLT”) treatment of a purchase of a property by the Appellants and in particular, whether the whole of the property should be treated as “residential” as defined in the SDLT legislation.[4]The Appellants appeal under paragraph 35 of Schedule 10 Finance Act 2003 (“FA 2003”) against a closure notice issued by the Respondents, (“HMRC”) on 8 January 2025 under paragraph 23 Schedule 10 FA 2003 in the sum of £48,450. The Appellants purchased a property (the “Property”) and paid SDLT of £80,000 on the basis that part of the Property (the “Field”) was not part of the grounds of the dwelling and therefore not residential for the purposes of SDLT. The closure notice amount reflects the additional amount of SDLT which HMRC say is due as a result of the Field being part of the grounds.[5]We have decided that the purchase of Field was correctly identified by HMRC as a purchase of part of the grounds of the dwelling for the reasons set out below.

BACKGROUND

[6]On 22 March 2024 the Appellants completed the purchase of the Property for £1,810,000.[7]On 25 March 2024 the SDLT return was filed on the basis of a purchase of non-residential/mixed use of the Property and on that basis paid £80,000 of SDLT.[8]On 1 November 2024 an officer of HMRC issued a notice of enquiry to the Appellants and their solicitors.[9]On 8 January 2025 the HMRC officer issued a closure notice to the Appellants under paragraph 23 Schedule 10 FA 2003 explaining the conclusion that the Field was part of the grounds of the Property.[10]On 10 May 2025 a notice of appeal was submitted to the First-tier Tribunal (Tax Chamber) (“FTT”) for Ian Sinclair.[11]On 29 September 2025 an application was made to join Diana Chilvers who had purchased the Property together with Ian Sinclair, as an Appellant. HMRC confirmed at the hearing that there was no objection to that application. Diana Chilvers has therefore been joined as a party to these proceedings.

Grounds of appeal

[12]The grounds of appeal can be summarised as follows:(1) The Field was not part of the garden or grounds of the house;(2) The Field was in commercial use at the date of completion of purchase of the Property. It was in active agricultural use;(3) Legal title (the Property being registered under one title only) is not determinative of the SDLT treatment;(4) An oral agreement with the neighbouring farmer regarding the Field was valid and longstanding;(5) The arrangement with the farmer was not a “barter of convenience”;(6) The Field serves a self-standing function; and(7) Fallow periods are consistent with commercial use.[13]For the reasons which will be made clear later in this decision, ground (2) to (7) are all part of the matters which need to be considered in determining ground (1). There is one issue in dispute: whether the Field was part of the grounds of the dwelling house. It is accepted by both parties that the Field is not part of the garden of the house.

BURDEN OF PROOF

[14]The burden is on the Appellants to show that the Property was partly non-residential. This requires the Appellants to show that the Field was not part of the grounds of the house.[15]The standard of proof is the ordinary civil standard, which is the balance of probabilities.

FAILURE TO ATTEND BY DIANA CHILVERS

[16]Diana Chilvers did not attend the hearing. We were told by Mr Sinclair that this was because she was working and unable to attend but was content for him to proceed in her absence.[17]Diana Chilvers has not provided a witness statement. However, it is clear from the documentary evidence that all of the arrangements involving the Field have been put in place by Ian Sinclair.[18]In the circumstances we were satisfied that it was in the interests of justice and fairness to proceed in the absence of Diana Chilvers.

APPLICATION TO ADMIT EVIDENCE

[19]Prior to the hearing Mr Sinclair had applied to admit additional evidence. HMRC had not objected to the application save in relation to two items: an NFU letter and a marked-up copy of the Property sales brochure. HMRC submitted that on face of the NFU letter it prohibited disclosure and the admission of the sales brochure was duplication as there was a copy in the bundle of evidence.[20]Mr Sinclair recognised the restriction against disclosure of the NFU letter and did not seek to renew his application in relation to it. However, he did seek to include the marked-up copy of the brochure, explaining that it was a copy of the hard copy version which showed a map, whereas the bundle only included a soft copy without the map. On that basis we admitted the marked-up copy as evidence.

EVIDENCE

[21]It was identified at the start of the hearing that the parties had a larger hearing bundle than the one provided to us. However, it was agreed by the parties that the larger bundle contained duplicates, and that use of the bundle provided to us, together with the additional admitted evidence, would suffice in order for us to be provided with all of the evidence.[22]The written evidence therefore consists of: the bundle of documentary evidence running to 249 PDF pages as set out in the index, the marked-up copy of the sale brochure and a series of emails, photographs and maps admitted as evidence prior to the hearing.[23]In addition, we heard oral evidence from Mr Sinclair. He had not produced a witness statement in advance of the hearing, but HMRC did not object to him giving evidence orally at the hearing.[24]In contrast, we were provided with a witness statement from Patrick Balfour, who was the vendor who sold the Property to the Appellant. However, Mr Balfour was not present at the hearing. We explained to Mr Sinclair that this meant that HMRC did not have the opportunity to put questions to Mr Balfour and, as a result, the weight of the witness statement may be reduced.[25]The dispute before us focuses upon the extent to which the use of the Field by a neighbouring farmer causes the Field to be treated as an area which is not “grounds”. We have been provided with an unsigned and undated agreement between the farmer and Mr Sinclair. We have also been provided with a letter from the farmer’s father-in-law, who owns the farm. However, neither the farmer nor his father-in-law attended the hearing. Instead, questions were put to Mr Sinclair, who was at times providing hearsay evidence. There is no rule against hearsay in this Tribunal, but again the result of this is that the weight we give to certain elements of the evidence may be reduced. In addition there were some matters which could not be explored with the farmer. We address the impact of this further in the context of our findings of fact.

FINDINGS OF FACT

[26]The facts set out below are found by us on the basis of the documentary and oral evidence.

A description of the Property

[27]The sales brochure described the Property in the following way:
“A fine Grade II listed farmhouse with over 3,000 square feet of accommodation and extensive outbuildings, in a picturesque location, set in over two acres of gardens and paddock”
. The location is described as “tucked away in the tranquil rural setting of the South Downs”. The Field is approximately 1 acre in size. While we accept, as Mr Sinclair submits, that a sales brochure is not a legal document and can contain hyperbole, the description we reference here is relevant context.[28]There are small lanes running around the entire perimeter of the Property, such that the house, gardens and the Field form one parcel, separated from neighbours by the lanes.[29]The map in the brochure shows the house is set to the north east of the Property with the gardens running behind it to the boundary on the lanes. The Field lies to the west and south of the Property. It runs the full length of the Property from the lane at the front of the house to the boundary and lane at the back. There is a gravel driveway between the house and the Field.[30]The sales brochure emphasised the views from the farmhouse, but those views are across the gardens and not the Field. Only the utility room has a window looking towards the Field.[31]The Field was described in the brochure as a paddock ideal for exercising horses or grazing animals. The Field is enclosed by post-and-rail fencing. On one side, the post-and-rail fencing separates the Field from a gravel driveway and the gardens. The post-and-rail fencing on the remaining sides is set inside the boundary caused by the lanes. Pictures of the Field were included in the sales brochure showing sheep grazing.[32]There are two points of access to the Field: a gate from the lane which is used by the farmer; and a gate from the driveway of the house.[33]At the time of completion, there were stables in the garden, although in a state of disrepair. The stables were at the bottom southerly end of the gardens by the boundary and lane. There was no direct access from the stables into the Field; it was necessary to access the Field from the stables either via the lane or via the driveway entrance through the gardens.

History

[34]Historically, the Property was part of a substantial farm. In 1988, the Property was separated under a newly created title. Given the enclosure of the Property by the lanes, it is not surprising that the house, garden and Field were separated together to form one parcel. Otherwise, there would have been a Field across a set of lanes on its own.

The grazing agreement

[35]The previous owners of the Property lived there from October 1993 until around 2018. An arrangement was put in place with the neighbouring sheep farmer around 2012 such that he would put a number of his sheep in the Field to graze. They would remain until they had grazed the grass down, and the farmer would then move them on elsewhere while the Field recovered.[36]It is not disputed that the farmer manages a working farm which is his commercial farming business. He has a flock of between 600 and 800 sheep. His father-in-law owns the farm and its land.[37]Mr Balfour (the previous owner) explains in his witness statement that no money changed hands, but the advantage of the arrangement was that the work and expense of mowing the Field was removed; and we give full weight to this statement which is consistent with the other evidence before us, including a letter from the farmer’s father-in-law . We were not provided with evidence as to the use of the Field prior to the start of the arrangement with the neighbouring farmer.[38]When the Appellants were initially considering purchase of the Property, they raised concerns about the maintenance of the Field. They were reassured by the description of the arrangement with the farmer. However, no contact was made with the farmer to confirm that the arrangement would continue until after the contracts for the purchase of the Property had been exchanged. Contracts were exchanged on 15 January 2024. Mr Sinclair contacted the farmer on 11 March 2024 about the sheep continuing to graze the Field periodically after completion of the purchase of the Property.[39]The farmer agreed to continue the existing practice after the purchase of the Property. Mr Sinclair asked the farmer to provide an email address so that the arrangement could be confirmed in writing. However, the farmer did not do so until the day of completion.[40]The day before completion of the purchase, Mr Sinclair was admitted to hospital. An undated and unsigned grazing agreement between Ian Sinclair and the farmer has been provided to us. It was put in place after completion as a result of Mr Sinclair’s hospitalisation.[41]It is not ideal that the agreement is unsigned and undated, particularly when the farmer was not present at the hearing. However, given the consistency of evidence from Ian Sinclair and Mr Balfour we find that the agreement reflects what was in place before completion; and provides further evidence that the parties had agreed before completion that the existing practice for the farmer to put sheep in the Field from time to time would continue.[42]The agreement states that the farmer is authorised to graze between six and twelve of his sheep in the Field at a time until they have grazed the grass down and then they are to be moved on elsewhere while the Field recovers. The farmer is to access the Field from the entrance on the lane. The agreement expressly confirms that the farmer is authorised to use the Field on that basis, but there is no relationship of landlord and tenant, nor are any rights created by the grazing of the Field. Thirty days’ notice can be given by either party to terminate the agreement.[43]Mr Sinclair told us that the farmer also maintains the fencing and hedgerow around the Field. We are content to rely upon his evidence on that matter. As he says, the farmer does so in order to keep his sheep safe. There is no obligation in the agreement for him to do so. Consequently, the Appellants save the costs of maintaining the fencing and of mowing the Field. Mr Balfour estimates that the cost of machinery for him would be between £15,000 and £20,000.[44]Mr Sinclair told us that at times the farmer also takes the opportunity, when grazing the Field, to put rams there in order to separate them from ewes. However, in the absence of the farmer we were unable to understand the real value of this to him, given that his father-in-law owns a large area of farming land. There was no suggestion that this resulted in the Field being used more frequently by the farmer.[45]Mr Sinclair maintains that neither he nor Diana Chilvers access the Field at any time. However, there is no legal restriction on them being able to do so.

Planning and maps

[46]We have been provided with copies of various maps showing the Property: DEFRA’s Magic Maps; the Pro Map; MapServe; the Valuation Office Agency; HM Land Registry; and the LPA. All of the maps show the Field as agricultural land.[47]A map of the Property in the sales brochure shows the gardens shaded in yellow and the Field shaded in green. Green is used for surrounding fields.[48]The Valuation Office has confirmed that the Field is agricultural land which is not subject to business rates and does not form part of the council tax assessment of the domestic property. The local planning officer has confirmed that the Field “possesses a different character to what might be regarded as the garden to the Property”. The officer also states that there is no planning history of the land ever being lawfully used as, or changed to, “garden land” and, from a professional opinion, it is considered to be agricultural.[49]Therefore, the evidence consistently shows that the Field is treated as agricultural land for various purposes.

Restrictive covenant

[50]There is a restrictive covenant applying to the Property which states:
“Use: Not to do or suffer to be done on the Property, or any part thereof, anything which may be or become a nuisance or annoyance to the occupiers of the Retained Land, provided that this shall not restrict the use of the Property for usual agricultural and sporting purposes.”
[51]This covenant is for the benefit of the Retained Land, requiring the owners of the Property not to do or allow anything to be done which may be or become a nuisance or annoyance. The words after the proviso mean that the restrictive covenant does not prevent the owners of the Property from using the Property for “usual agricultural and sporting purposes”. Mr Sinclair has sought to argue that the restrictive covenant means that the Property cannot be used for purposes other than agricultural and sporting purposes. That is not correct.

THE LAW

[52]SDLT is a tax applied to specific types of transactions. By virtue of section 42 FA 2003 SDLT is charged on land transactions.[53]Section 44 FA 2003 sets out the rules to determine the effective date of the chargeable transaction, which in this case, in accordance with section 119 FA 2003, is the date of completion.[54]Therefore the SDLT charge arises on the date of completion by reference to the relevant land transaction.[55]The amount of tax chargeable in respect of a chargeable transaction depends upon whether the relevant land consists entirely of residential property or consists of, or includes, land that is not residential property ( section 55 FA 2003).[56]Section 116 FA 2003 sets out the meaning of residential property as follows:
“(1) … “Residential property” means – a building that is used or suitable for use as a dwelling, or is in the process of being constructed or adapted for such use, and land that is all forms part of the garden or grounds of a building within paragraph (a) (including any building or structure on such land), or an interest in or over land that subsist for the benefit of a building within paragraph (a) or of land within paragraph (b) and “non-residential property” means any property that is not residential property.” and “non-residential property” means any property that is not residential property.”
[57]The issue of whether land forms part of the “garden or grounds” of a dwelling is to be determined as a matter of fact and degree, applying the ordinary meaning of those words. As the Upper Tribunal observed in Hyman & Goodfellow v Revenue and Customs [2021] UKUT 0068 (TCC), the statutory language requires there to be a connection between the land in question and the dwelling; the legislation does not prescribe any fixed criteria by which that connection is to be established.[58]The Upper Tribunal in Suterwalla and Suterwalla v HMRC [2024] UKUT 00188 (TCC) made clear that the Tribunal must undertake a multifactorial evaluative exercise, weighing all relevant circumstances in order to reach a balanced conclusion. Each case must be considered on its own facts, and no single factor is determinative.[59]In carrying out the multifactorial evaluation the Upper Tribunal approved the following list of factors:(1) Grounds is an ordinary English word;(2) HMRC’s SDLT manual is a fair and balanced starting point (considering historic and future use, layout, proximity to the dwelling, extent, and legal factors/constraints);(3) Each case must be considered separately in the light of its own factors and the weight which should be attached to those factors in the particular case;(4) There must be a connection between the garden or grounds and the dwelling.;(5) Common ownership is a necessary condition, but not a sufficient one;(6) Contiguity is important, grounds should be adjacent to or surround the dwelling;(7) It is not necessary that the garden or grounds be needed for ‘reasonable enjoyment’ of the dwelling having regard to its size and nature;(8) Land will not form part of the ‘grounds’ of a dwelling if it is used or occupied for a purpose separate from and unconnected with the dwelling;(9) Other people having rights over the land does not necessarily stop the land constituting grounds. This is so even where the rights of others impinge on the owners’ enjoyment of the grounds and even where those rights impose burdensome obligations on the owner;(10) Some level of intrusion onto (or alternative use of) an area of land will be tolerated before the land in question no longer forms part of the grounds of a dwelling. There is a spectrum of intrusion/use ranging from rights of way (still generally grounds) to the use of a large tract of land, historically in separate ownership used by a third party for agricultural purposes under legal rights to do so (not generally grounds);(11) Accessibility is a relevant factor, but it is not necessary that the land be accessible from the dwelling. Land can be inaccessible and there is no requirement for land to be easily traversable or walkable;(12) Privacy and security are relevant factors;(13) The completion of the initial return by the solicitor on the basis the transaction was for residential property is irrelevant.;(14) The land may perform a passive as well as an active function and still remain grounds;(15) A right of way may impinge an owner’s enjoyment of the grounds or even impose burdensome obligations, but such rights do not make the grounds any less the grounds of that person’s residence; and(16) Land does not cease to be residential property, merely because the occupier of a dwelling could do without it.[60]The same Upper Tribunal decision made clear that whether or not a taxpayer would have preferred to buy a property without the disputed land has no bearing on the SDLT liability of the chargeable interest that they did in fact acquire.[61]Furthermore in The How Development 1 Ltd v HMRC [2023] UKUT 84 (TCC) the Upper Tribunal said that:
“We accept that the phrase “residential property” is part of the statutory context, and that any word or words in a statute should be construed in context. That does not, however, require that an ordinary English word, such as “grounds”, should be given an extra-statutory gloss or some form of special meaning…. we do not consider that “grounds” must be “residential” in nature or have a “residential” purpose insofar as that is said to add anything to the requirement that they be grounds “of” a dwelling. It is not clear to us how that test should be applied and it seems to introduce an element of circularity into the definition.”
[62]In relation to the concept of “commercial” use, HMRC’s published guidance indicates that active and substantive commercial exploitation may be a strong indicator that land is not garden or grounds. The authorities emphasise that the mere presence of some commercial activity is not conclusive, and the concept of “commercial” use must be considered as one element in the overall evaluation exercise.

THE APPELLANTS’ CASE

[63]Mr Sinclair had produced an extensive skeleton argument for the Appellants’ case for which we were most grateful. We have considered those in full but it would be otiose to set them out in full here. In summary, Mr Sinclair submits:(1) The Field does not function as an appendage to the dwelling, and therefore does not fall within the meaning of “grounds” as derived from case law;(2) The Field was used continuously and exclusively for commercial agricultural purposes by a farmer for at least six years prior to, and at, completion, forming part of his established farming business. The farmer’s grazing activity constituted genuine commercial use, involving livestock grazing as part of a wider farming enterprise;(3) The Field had a self-standing function, separate from and unconnected with the residential use of the farmhouse, and was not incidental to the enjoyment of the dwelling. The Field forms part of a wider commercial farming operation, rather than serving the residential function of the Property;(4) The grazing arrangement pre-dated the Appellant’s ownership and continued thereafter, indicating an established and ongoing pattern of agricultural use rather than an artificial arrangement;(5) The arrangement, although informal and without rent, is a valid commercial grazing arrangement, consistent with common agricultural practice. The separate commercial purpose (sheep grazing) precludes the Field’s classification as residential land. The arrangement is not a “barter of convenience”, but reflects a genuine commercial relationship with economic benefit to both parties;(6) The Field is physically distinct from the residential curtilage, being separated by fencing, lacking domestic features, and laid out as rough pasture. It has independent access and is managed exclusively by the farmer, without involvement from the Appellants, reinforcing its separate function. The Field has not been integrated into the residential curtilage and has remained in separate agricultural use;(7) The Field is classified as agricultural land by multiple official sources, including DEFRA, VOA, LPA and mapping systems. Consistent with that, the Field is not subject to business rates and is excluded from council tax assessment, supporting its non-residential classification;(8) There has been no planning permission or change of use to residential garden land, and the Field remains agricultural in planning terms. It would be a breach of law to use it as garden or grounds;(9) References in the marketing materials (e.g.“paddock”) are not determinative of legal status as such descriptions are promotional only. Inn any event, there were few references to the paddock in the brochure;(10) The Field does not contribute to the use, enjoyment, or setting of the dwelling, and is not relied upon for residential purposes; and(11) The restrictive covenant means that the Field can only be used for agricultural or sporting purposes.

HMRC’s case

[64]HMRC’s case can be summarised as follows:(1) A balancing exercise of relevant factors (including use, layout, proximity, and legal constraints) supports the conclusion that the Field is grounds of the dwelling;(2) Commercial use is not determinative, and even if relevant, it must be substantial; limited or incidental use will not prevent land from being classified as grounds. The grazing activity was minimal, irregular, and incidental, consistent with maintenance of the land rather than substantive agricultural exploitation. It is a “barter of convenience”, providing mutual benefit (maintenance of the land) rather than constituting a commercial enterprise;(3) The Field was not shown to be in separate or exclusive occupation, nor subject to restrictions inconsistent with its use as residential grounds;(4) The Appellants retained full control over the Field, including the ability to prevent or terminate any grazing;(5) The Field is contiguous with the dwelling and forms part of a single parcel, supporting its classification as part of the grounds;(6) The layout and setting of the Property are typical of a rural residential property, where surrounding land contributes to its character, privacy, and enjoyment. The Field contributes to the rural character and setting of the dwelling, forming part of the overall residential amenity;(7) Land can remain “grounds” despite limited third-party use or intrusion; and(8) The ultimate and overall character of the Field is residential, and any use by the farmer does not alter that character. DISCUSSION Did the Property consist of, or include, land that is not residential property?

DISCUSSION

[65]The fundamental question for us is whether the Field formed part of the “grounds” of the Property. If the Field is “grounds” then it is residential; if it is not “grounds” it is not residential. It is important, as the authorities have stated, that the test is applied in that way as that is what the legislation says. While the heading of the section referring to “residential” property colours the exercise, it is important not to lose sight of the way in which the specific SDLT legislation is written, The Upper Tribunal said in the case of How that it was not the correct approach to consider whether land was “residential” in nature or has a “residential” purpose (see the earlier quotation). That ends up in circularity.[66]The Field is contiguous with the house and garden and is proportionate in size to the dwelling. It can be accessed from the driveway, and the configuration of the surrounding lanes, together with the trees and hedgerows, means that, as a matter of ordinary perception, the Field forms part of the overall plot. The fact that the Field is enclosed by fencing does not detract from that overall impression.[67]The historic position is also relevant. The Property previously formed part of a larger farm. When it was separated, the house, garden and the Field were conveyed together within the natural boundary created by the surrounding lanes. That history supports the view that the Field formed part of a single identifiable parcel associated with the dwelling.[68]The description of the Property in the sales brochure, including reference to “garden and paddock” is consistent with the presentation of the Field as part of the grounds of a rural residential property.[69]Although the Field is not visible from the house and does not contribute to the views from the dwelling, it nevertheless contributes to the rural character of the Property. Ownership of the Field also affords the Appellants a degree of control over its use which in turn enhances the privacy and security of the Property. Mr Sinclair says that the Field does not provide a sense of privacy as the Property is surrounded by open farmland, countryside views and old agricultural buildings. That is recognised, but having the Field under the control of the Appellants means that they control who can be in that part of the Property. Including the Field within the curtilage of the Property means that the owners have a distinct parcel of land, wrapped around by the lanes, which they can fully control. In that way the sense of privacy and security is quite clearly enhanced.[70]Absent the grazing arrangement, there would therefore be little difficulty in concluding that the Field formed part of the grounds of the dwelling. The impact of that arrangement is the key question. It brings into focus factors (8) –(11) in particular of the Sutterwala list set out earlier.[71]Before turning to the grasskeep arrangement in detail, it is worth reiterating that, as set out earlier, the authorities make clear that the use of the land is a relevant consideration, but it is not determinative. Therefore the classification of the Field as “agricultural” for planning, council tax and cartography does not in itself determine whether the Field is “grounds”. The weight to be given to such use depends on its nature and extent.[72]Mr Sinclair submits that it would be a breach of planning law to use the Field as garden or grounds. However, that submission is bound up with Mr Sinclair’s argument that the fact that the Field is classified as agricultural determines whether it is grounds. As we explain, the agricultural classification is one factor in the multifactorial assessment. Classification for planning does not determine the SDLT test.[73]That same point arises in relation to whether the Field is used commercially. The farmer uses the land to graze his sheep from time to time. That is part of his commercial activity of farming.[74]We respectfully agree with the statements made in the FTT case of Harjono v HMRC [2024] UKFTT 00228 (TC). The fact of commercial use does not equate with land ceasing to be “grounds”. It is a factor to be considered and in particular, we need to consider the extent of that commercial use. HMRC refer to active and substantive exploitation for a separate commercial purpose.[75]The relevant time for assessing the grasskeep arrangements is completion. At that point the unsigned and undated agreement had not been entered into. However, we are satisfied that that document did no more than evidence the arrangement which had been in place for six years and which the farmer and Mr Sinclair had agreed should continue. The fact that it is unsigned and undated is not a material issue for us.[76]The arrangement permits a farmer to graze a limited number of sheep on the Field from time to time, after which they are moved on while the grass recovers. The grazing is limited, intermittent, and consistent with maintenance of the land. Each side to the arrangement benefits: the farmer can access some additional land to graze a few of his sheep and the Appellants have the Field maintained. In that sense it is a “barter of convenience” (the term coined by the FTT in the case of Sangeeta Modha v HMRC [2023] UKFTT 783 (TC)). To be clear, that concept does not detract from the fact that the use of the Field is part of the farmer’s commercial activities.[77]The agreement may be terminated on just 30 days’ notice. The Appellants retain full access and control over the Field. They can go into it at any time even if they do not go into it in practice. There is no legal restriction preventing the Appellants from terminating the grasskeep arrangement and using the Field for other purposes, including keeping animals or planting an orchard.[78]The use of the Field by the farmer is partly for the farmer’s commercial purpose of feeding his sheep but is also intrinsically connected to the dwelling as it has the purpose of cutting the grass in the Field. Absent any evidence to the contrary from the farmer, we are unable to conclude that the main purpose of the arrangement is to provide grazing for the sheep. The main purpose is to help the Appellants maintain the Field.[79]We turn to other points relied upon by Mr Sinclair. He placed some reliance on the fact that he did not wish to acquire the Field, but the authorities say this is not relevant as explained earlier.[80]We have set out in our findings how the restrictive covenant applies and this does not affect whether the Field is “grounds”.[81]Mr Sinclair has referred to prices of other properties in the area without land akin to the Field being around the same as the price paid for the Property. However, whether the Field has value in itself does not determine whether it constitutes “grounds”.[82]Mr Sinclair has referred us to various other FTT decisions. Firstly other FTT decisions do not bind us. To the extent that they set out principles with which we disagree it is good practice for us to explain why. The authorities which bind us are those decided by the Upper Tribunal and higher courts.[83]Secondly, the authorities have made clear that the cases are highly fact specific. What may appear at first sight to be small differences in fact lead to the multifactorial evaluation tipping one way or another. It is therefore not appropriate for us to address each case where land has been found not to be “grounds”. Instead, we must apply the principles decided by the Upper Tribunal and higher courts to the specific facts before us.[84]Given those facts we are clear that the use of the Field by the farmer is not of such a nature or degree as to cause the Field to fall outside the term “grounds”. The multifactorial approach required by the authorities leads to the conclusion that the Field should properly be regarded as part of the “grounds” of the Property for SDLT purposes.

CONCLUSION

[85]Therefore the appeal is DISMISSED. The decision made by HMRC that the chargeable transaction by which the Property was purchased was a transaction which gave rise to SDLT at the residential rate was correct.

Right to apply for permission to appeal

[86]This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party. The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice. Release date: 29 May 2026