Multiple Dwellings Relief (MDR) let a purchaser buying two or more dwellings in a single transaction calculate SDLT on the average price per dwelling, rather than the total price — a materially cheaper outcome for most multi- dwelling and annexed-property transactions. MDR was abolished for transactions with an effective date on or after 1 June 2024. This page covers the historic calculation, the transitional provisions, and how annex and multi-dwelling purchases are treated now.

Historic MDR calculator (pre-1 June 2024)

What MDR did — the historic mechanic

Before 1 June 2024, MDR let a buyer purchasing two or more dwellings in a single transaction calculate SDLT as follows:

1. Divide the total price by the number of dwellings to get an average price per dwelling.
2. Calculate SDLT on that average price using standard residential rates (and the additional-property surcharge if applicable).
3. Multiply the per-dwelling SDLT by the number of dwellings.
4. Compare against the 1% floor (1% of the total purchase price). SDLT is the higher of the two.

The mechanic materially reduced SDLT on multi-dwelling transactions because it kept more of the price inside the lower SDLT bands. A single £900,000 purchase attracts SDLT at the higher bands; three £300,000 dwellings (average) sit entirely in the lower bands.

Historic worked example — £900,000, three dwellings

An individual landlord bought three flats in one transaction for £900,000, completing in March 2024. Buying two or more dwellings normally triggered the higher rates (then 3%), so choose Additional property in the calculator above.

• Average price per dwelling: £900,000 ÷ 3 = £300,000
• SDLT on £300,000 at the higher rates: 3% × £250,000 + 8% × £50,000 = £7,500 + £4,000 = £11,500
• × 3 dwellings = £34,500
• 1% floor: £9,000 (1% of £900,000)
• MDR SDLT: £34,500 (higher of £34,500 and £9,000)
• Without MDR: £59,500 (3% × £250,000 + 8% × £650,000)
• MDR saving: £25,000

For a buyer not liable to the higher rates (for example where the higher-rates rules did not apply), the same tool gives £2,500 per dwelling, £7,500 in total, so the 1% floor of £9,000 applied, against £32,500 without MDR: a saving of £23,500.

Why MDR was abolished

MDR was introduced to support investment in residential property. The government's policy paper on its abolition says an external evaluation found "no strong evidence that the relief plays a significant role in supporting residential property investment", and concluded MDR was not cost-effective in meeting its original objectives. An earlier 2021 consultation had also looked at tackling abuse of the relief, including disputed claims that an annex or outbuilding was a separate dwelling.

The Spring Budget on 6 March 2024 announced abolition. It took effect for transactions with an effective date on or after 1 June 2024, with transitional rules for contracts exchanged on or before 6 March 2024.

Transitional provisions

MDR can still be claimed for transactions that meet the transitional conditions:

• The contract was entered into (exchanged) on or before 6 March 2024, AND
• After 6 March 2024 the contract was not varied, its rights were not assigned or sub-sold, and the transaction did not result from exercising an option or right of pre-emption

If both apply, MDR is available whenever completion happens, including on or after 1 June 2024. HMRC's manual (SDLTM29902) says the exchange date must be entered on the return, or the MDR claim will be rejected. If an exclusion applies, the transaction had to complete before 1 June 2024 to qualify. If you completed under a qualifying contract and MDR was not claimed, see the amendment time limits below.

Current position — post-abolition (from 1 June 2024)

For transactions from 1 June 2024 onwards, SDLT on multi- dwelling purchases uses the standard rate calculation with no per-dwelling averaging. This has three distinct sub-cases.

Case 1 — main house with annex or "granny flat"

Where the annex qualifies as a subsidiary dwelling (broadly, self-contained, with the main dwelling accounting for two-thirds or more of the total value), the whole transaction is treated as a single dwelling. Standard SDLT applies with no additional-property surcharge (assuming it's your only residential property). Compared with the old position, the buyer avoids the surcharge but loses any MDR averaging saving that could previously have been claimed on the annex.

Case 2 — main house with substantial annex (not subsidiary)

Where the annex is self-contained but not "subsidiary" (main dwelling accounts for less than two-thirds of value), the transaction is treated as buying multiple dwellings — the additional-property surcharge (5%) applies to the whole price. Without MDR there is no per-dwelling averaging to offset it, so the higher rates apply to the full price.

Case 3 — portfolio purchases (2-5 flats/houses in one transaction)

Standard residential SDLT applies to the whole price, plus the 5% additional-property surcharge (assuming you already own another residential property). No relief for the multiple- dwelling nature. On a £900,000 purchase of three £300,000 flats, SDLT at current rates is £80,000 (£35,000 standard + £45,000 surcharge), against £34,500 under MDR at the rates in force before abolition.

Case 4 — six or more dwellings in one transaction (still eligible for non-residential rates)

Where a single transaction involves 6 or more dwellings, the buyer can still elect to use non-residential SDLT rates instead of residential rates. This election was not abolished alongside MDR: the government's abolition policy paper confirms that purchases of 6 or more dwellings continue to qualify for non-residential rates, and GOV.UK lists "6 or more residential properties bought in a single transaction" as non-residential property. Non-residential rates are 0% up to £150,000, 2% on the next £100,000 and 5% above £250,000, with no 5% surcharge, so they are usually much lower than residential rates plus the surcharge on a large purchase.

What counts as a "dwelling" — the subsidiary-dwelling test

Whether part of a property is a separate dwelling depends on the facts (see HMRC's SDLT Manual, SDLTM09755). Features that are commonly weighed include:

• Self-contained access (independent front door)
• Own kitchen and bathroom
• Own council-tax banding
• Independent utility supplies where practical
• Physical separation from the main dwelling (not just an internal partition)

Where the annex is shared-access, shared-kitchen, or without its own council-tax band, HMRC will generally treat it as part of the main dwelling. For clearly self-contained annexes, the subsidiary-dwelling test then determines whether the surcharge applies to the whole price. Under SDLTM09766, a dwelling is subsidiary if it is in the same building or grounds as the main one and the main dwelling accounts for at least two-thirds of the total price.

Post-abolition worked example — same £900k transaction, three dwellings

Same purchase, effective date 1 August 2026, three self-contained flats bought together as additional property. Current rates apply (in force since 1 April 2025, with the 5% surcharge in force since 31 October 2024).

• Standard SDLT on £900,000: 0% × £125k + 2% × £125k + 5% × £650k = £2,500 + £32,500 = £35,000
• Surcharge: 5% of £900,000 = £45,000 (the 5 points are added to every band, so with rates of 5%, 7% and 10%: £6,250 + £8,750 + £65,000 = £80,000 in total)
• Post-abolition SDLT: £80,000
• Under MDR before abolition (historic example above): £34,500
• Difference: £45,500. Part of this comes from abolition and part from the higher surcharge and lower nil-rate band now in force.

Retrospective MDR claims — amendment window

GOV.UK's SDLT refund guidance covers a relief that was available but not claimed. You can amend the return within one year of its filing date. After that, you can make an overpayment relief claim no more than 4 years after the effective date of the transaction. HMRC then has up to 9 months to check the amended return or claim. By November 2026, only transactions with an effective date from roughly November 2022 are still inside the 4-year limit. Be wary of anyone offering a "no win, no fee" MDR claim on an annex that may not be a separate dwelling. HMRC challenges these claims, and a rejected claim can bring interest and penalties.

Planning for current multi-dwelling purchases

With MDR gone, the primary planning routes are:

1. Structure as a subsidiary dwelling where the annex is genuinely subsidiary (main dwelling worth ≥ 2/3 of total). This keeps the transaction inside the single-dwelling regime with no surcharge.
2. Use the 6+ election for portfolio acquisitions. Where you can bundle 6 or more dwellings into a single transaction, the non-residential-rate election is materially cheaper than the residential-plus-surcharge alternative.
3. Don't assume separate contracts help. Purchases from the same seller, or otherwise connected, can be linked transactions for SDLT, and the higher rates still apply to each additional dwelling. Get advice before structuring a deal around this.
4. Buying through a company changes the SDLT position. Companies pay the higher rates on every residential purchase, and a 17% single rate can apply to dwellings over £500,000 unless a relief applies (raised from 15% on 31 October 2024). Specialist tax advice is essential.

Frequently asked questions

Does Multiple Dwellings Relief still exist?

No — abolished for transactions with an effective date on or after 1 June 2024. Under the transitional rules it can still apply where contracts were exchanged on or before 6 March 2024 and not varied, assigned or sub-sold afterwards, even if completion was later.

How was MDR calculated before abolition?

Total price ÷ number of dwellings = average per dwelling. Calculate SDLT on that average, multiply by number of dwellings, compare with 1% floor. Higher figure applies.

Can I still claim MDR retrospectively?

Only for transactions that qualified for MDR. You can amend the return within one year of its filing date. After that, an overpayment relief claim must be made no more than 4 years after the effective date (GOV.UK SDLT refund guidance).

What replaced MDR for annex purchases?

Nothing replaced the relief itself. What matters now is the higher-rates "subsidiary dwelling" rule (SDLTM09766). If the annex is in the same building or grounds and the main dwelling accounts for at least two-thirds of the price, buying both does not by itself trigger the surcharge. Otherwise the higher rates normally apply to the whole price.

What counts as a 'dwelling' for SDLT?

Self-contained unit — own front door, kitchen, bathroom, independent access. HMRC scrutinises annex claims carefully. Own council-tax banding is a strong indicator.

Does the abolition affect buy-to-let landlords?

Yes. Purchases of 2–5 dwellings in one transaction now pay residential SDLT on the whole price, normally with the 5% surcharge. On three flats for £900,000, that is £80,000 at current rates, against £34,500 under MDR before abolition.

Is MDR the same as the '6 or more properties' rule?

No. The 6+ non-residential-rate election was NOT abolished and remains available. It's the primary planning route for large portfolio acquisitions post-MDR.

Where is the MDR abolition legislation?

Section 7 of the Finance (No. 2) Act 2024. HMRC's SDLT Manual (SDLTM29901 and SDLTM29902) explains the abolition and transitional rules.

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Last reviewed: 2 November 2026. Estimate only — always confirm SDLT with your conveyancer.