My understanding of stamp duty land tax (SDLT) is as follows. An agricultural barn with planning consent for a residence is a conversion from one planning class to another and as such it is really no different to buying a site. Whatever the value is of the site, it will trigger SDLT on the acquisition at the prevailing rate for residential property currently at 0% up to £125,000, 2% on any value between £125,000 and £250,000 and 5% for anything above £250,000 and up to £925,000.To be clear, construction costs thereafter, as long as they are not carried out by the land vendor on your behalf, should be free of SDLT.

If, as you suggest, the barn is to be considered a commercial building or agricultural land then the SDLT treatment will be zero% up to £150,000, 2% on any value between £150,000 and £250,000 and 5% on anything above this. Construction costs thereafter should be exempt. Consequently the two treatments are very similar until the land (barn) valuation gets above £925,000 when rates for residential property take another hike to 10%. I am not aware of any other reliefs and would calculate that the agricultural land route would probably be slightly more competitive than using the residential property equation.

Tim Doherty, Build It expert and MD at Dobanti Chartered Surveyors