SDLTM10023 - Mobile Homes, Caravans and Houseboats

Mobile Homes (‘Park Homes’)

SDLT legislation does not make specific provision for mobile homes or other homes of a semi-permanent nature and the SDLT treatment of these homes, and the land on which they stand, will depend on the nature of the interest which they represent. This is a matter of general land law.

The structure of the mobile home, and the land on which it stands, need to be carefully considered and may need to be treated separately.

Is it part of the land?

The first question to consider is whether the object forms part of the land on which it stands or is separate from it. This will depend

  • first, on the use and purposes for which it was erected, and
  • second, on the degree of annexation to the land.

These are matters of fact in each case.

The Courts have held that, if the object is in the nature of a dwelling, it is likely that it has been erected with a view to the enjoyment of the property as a whole and therefore constitutes part of the land.

This is likely to be the case even if the object itself is in kit form and could be dismantled and re-erected elsewhere, or if it is not actually affixed to the land but rests on its foundations under its own weight.

On the other hand, a caravan, which can be readily moved from place to place without requiring demolition or damaging the fabric of the land, may be sited with a view to the enjoyment of the caravan rather than the land.

In this case it may constitute moveable property (a ‘chattel’), separate from the land. It will not necessarily be precluded from being moveable property merely because it is connected to main services, provided that those connections can be readily disconnected to facilitate removal.

Lease or licence?

The land on which the building or structure stands (including the building itself) may be the subject of a freehold or a lease, the grant or assignment of which is chargeable to SDLT.

Alternatively, an interest in a pitch for a caravan or mobile home may be a mere licence to occupy land, which is not a chargeable interest for SDLT purposes. In this case, the nature of the structure on the land is irrelevant.

The nature of the interest will depend on the details of the agreement with the site operator. It is important to note that a document described as a licence may sometimes in law be a lease, or vice versa.

Generally speaking, if the agreement grants exclusive occupation of a particular area for a term of years it will be a lease. If it includes provision to move a mobile home or caravan to an alternative pitch at the site operator’s request, or to allow the site operator free access to the property and/or the land, then it is likely to be a licence.

It is usual for a caravan site agreement to be renewed annually but, even where there is a longer fixed term, the question of exclusive possession of the site will be the main factor in deciding whether this is a lease or a licence.

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Houseboats

Mooring rights on UK inland waterways or coastal waters will constitute an interest in land which may be liable to SDLT.

If the mooring agreement grants exclusive possession of a berth to the boat owner for a term and a payment is made this is likely to be a lease. If the agreement permits the operator of the moorings to move the boat onto another berth should this be necessary, or allows the operator to access the berth without notice, this is more likely to be a licence and not liable to SDLT.

If the agreement is a lease, SDLT will be due on the consideration given for the grant or assignment of the lease. This may include the sum paid for the boat if ownership changes hands with the mooring agreement and the boat is permanently attached to the mooring (so is a fixture rather than moveable property).

If the boat can be easily disconnected from main services (for example, by means of ‘push fit’ fittings) and removal from its moorings would not damage the fabric of the land then it will be treated as moveable property and therefore not subject to SDLT. If however, there is a structure which forms part of the boat itself, which in turn is permanently secured to the land, and to move this would involve damaging the fabric of the land then it will be treated as a fixture and will attract SDLT.