Couple's £81k tax bill after pool house excuse denied

Tax advisers for the couple said the pool house was part of a separate dwelling (generic image)

A legal tribunal has rejected a couple's "contrived" attempt to avoid tax by declaring that a pool house on their £2m property could be seen as part of a separate dwelling.

Alexander and Rebecca Clark claimed Multiple Dwellings Relief (MDR) on the six-bedroom home at Upper Basildon, Berkshire.

They told tax authorities the indoor pool and a bedroom above a double garage did not belong to the main house, the First-Tier Tribunal heard.

However, Judge Ruthven Gemmell said the claim was "simply a device" to avoid a £81,250 tax bill.

The property in Bethesda Street was described by estate agents as an "exceptional individual architecturally designed country residence", the tribunal said.

The main house was attached to a wing containing the pool house and garage, court documents showed.

In 2021, tax advisers for Mr Clark, 48, and his 47-year-old wife told the Inland Revenue the main house was separate from the pool and other rooms in the wing, the court said.

They claimed relief on Stamp Duty Land Tax on the basis that the property was in fact two dwellings, separated by a lockable glass door.

Subsequently, the couple told the tribunal neither dwelling needed to include the swimming pool, Judge Gemmell said.

However, she said sharing the pool would mean having to leave the dividing glass door unlocked.

The judge's written report concluded: "The concept of a one bedroom (which also served as a living room) property, with a hallway, small kitchen and WC/shower room, with a swimming pool, some four times the area of the latter three areas, was contrived."

The couple will now have to pay the outstanding £81,250 tax bill.

Multiple Dwellings Relief was abolished by the government from 1 June 2024.