Why Should I Pay Stamp Duty If the Property’s Uninhabitable?

You’ve just bought a house with no kitchen, no bathroom, no heating… and quite possibly no floor. It’s damp, dark, and full of things that probably scurry at night. It’s not a home — it’s a project. Yet somehow, HMRC says it counts as a residential property and wants you to pay stamp duty like it’s a charming little cottage ready to move into.

Honestly, how does that make sense?

It’s Not a Home, It’s a Headache

Let’s be clear. If a property doesn’t have the bare basics — working plumbing, electricity, a front door that locks — it’s not fit to live in. You couldn’t rent it out, couldn’t move in, couldn’t even get insurance on it half the time. And yet, for stamp duty purposes, it’s treated the same as a perfectly livable flat.

The logic? HMRC says it only needs to be capable of being used as a dwelling. In other words, if someone could theoretically live there (with a bit of imagination and perhaps a gas mask), then you’re on the hook.

Paying a Premium for a Problem

It’s the brave — or possibly slightly mad — buyers who take on these wrecks. People who are actually doing a service: breathing life into properties that would otherwise sit empty and crumbling. But instead of being cut some slack, they’re penalised.

Because if it’s a second property, they get hit with the extra 3% surcharge — even though no one could live there, let alone rent it out. That’s how stamp duty on uninhabitable property turns into a weird little trap. You’re paying tax as if you’ve bought a finished product, when what you’ve actually bought is a money pit and a tetanus risk.

And the cherry on top? If you try to challenge it, you have to prove the place was truly uninhabitable. That means surveys, reports, photos, maybe even a trip to a tribunal. All before you’ve even had a chance to rip out the rotten floorboards.

Time for a Bit of Common Sense?

Surely it wouldn’t be that difficult to create a proper system. One where an independent surveyor could confirm a property’s uninhabitable status, and buyers could be taxed accordingly — without needing to fight tooth and nail for it.

Right now, you pay stamp duty based on what a house used to be or could be someday, not what it is on the day you buy it. And if what you’ve just bought is a glorified shed with a collapsed roof and a family of pigeons living in the chimney… well, maybe the tax bill should reflect that.

Because paying luxury tax on a building that doesn’t even have a toilet? That’s not just frustrating. That’s absurd.