C1C2C3C4C5C6Part 4Stamp duty land tax

Annotations:
Modifications etc. (not altering text)
C3

Pt. 4 modified (17.7.2013) by Finance Act 2013 (c. 29), s. 194(8)-(12)

C4

Pt. 4 applied (17.7.2014) by Finance Act 2014 (c. 26), ss. 223(8)(9)(d)

C5

Pt. 4 modified (temp.) (22.7.2020) by Stamp Duty Land Tax (Temporary Relief) Act 2020 (c. 15), s. 1 (as amended (10.6.2021) by 2021 c. 26, s. 87(2))

C6

Pt. 4 modified (temp.) (10.6.2021) by 2020 c. 15, s. 1A (as inserted by Finance Act 2021 (c. 26), s. 87(3))

Reliefs

71AF1Alternative property finance: land sold to financial institution and leased to F4person

1

This section applies where arrangements are entered into between F3a person and a financial institution under which—

a

the institution purchases a major interest in land or an undivided share of a major interest in land (“the first transaction”),

b

where the interest purchased is an undivided share, the major interest is held on trust for the institution and the F4person as beneficial tenants in common,

c

the institution (or the person holding the land on trust as mentioned in paragraph (b)) grants to the F4person out of the major interest a lease (if the major interest is freehold) or a sub-lease (if the major interest is leasehold) (“the second transaction”), and

d

the institution and the F4person enter into an agreement under which the F4person has a right to require the institution or its successor in title to transfer to the F4person (in one transaction or a series of transactions) the whole interest purchased by the institution under the first transaction.

2

The first transaction is exempt from charge if the vendor is—

a

the F4person, or

b

another financial institution by whom the interest was acquired under arrangements of the kind mentioned in subsection (1) entered into between it and the F4person.

3

The second transaction is exempt from charge if the provisions of this Part relating to the first transaction are complied with (including the payment of any tax chargeable).

4

Any transfer to the F4person that results from the exercise of the right mentioned in subsection (1)(d) (“a further transaction”) is exempt from charge if—

a

the provisions of this Part relating to the first and second transactions are complied with, and

b

at all times between the second transaction and the further transaction—

i

the interest purchased under the first transaction is held by a financial institution so far as not transferred by a previous further transaction, and

ii

the lease or sub-lease granted under the second transaction is held by the F4person.

5

The agreement mentioned in subsection (1)(d) is not to be treated—

a

as substantially performed unless and until the whole interest purchased by the institution under the first transaction has been transferred (and accordingly section 44(5) does not apply), or

b

as a distinct land transaction by virtue of section 46 (options and rights of pre-emption).

F26

The requirements of subsection (1), or (4)(b)(ii), are not met if—

a

the F4person enters into the arrangement, or holds the lease or sub-lease, as trustee and any beneficiary of the trust is not F3a person, or

b

the F4person enters into the arrangements, or holds the lease or sub-lease, as partner and any of the other partners is not F3a person.

7

A further transaction that is exempt from charge by virtue of subsection (4) is not a notifiable transaction unless the transaction involves the transfer to the F4person of the whole interest purchased by the institution under the first transaction, so far as not transferred by a previous further transaction.

F58

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9

References in this section to F3a person shall be read, in relation to times after the death of the F4person concerned, as references to his personal representatives.

F610

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