Legalize / United Kingdom / Public General Act

Finance Act 2003

Type Public General Act

Publication 2003-07-10

Last updated 2025-03-20

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

[^key-f8c8c67c51d81c8e5830a59ef4b6d07c]: Word in Sch. 7A para. 17(1)(a) omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(14)(a) (with reg. 63)

[^key-c7c8906ba1aa14efaf8edfb6b7fb9b94]: Words in Sch. 7A para. 17(2)(a) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(14)(b) (with reg. 63)

[^key-0ef8b841ecbc954306ce93c66ad37abf]: Words in Sch. 7A para. 17(5) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(14)(c) (with reg. 63)

[^key-3756aaaa6bd9c19a87a217c4c9b22c84]: Word in Sch. 7A para. 17(6) omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(14)(d)(i) (with reg. 63)

[^key-50b07acb850c54ac866a5e35514c6457]: Words in Sch. 7A para. 17(6) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(14)(d)(ii) (with reg. 63)

[^key-a7038101b7caa0a8a8e198cf74ce71f0]: Word in Sch. 7A para. 17(6) omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(14)(d)(iii) (with reg. 63)

[^key-faf179d0eedfe68bc95a0c6c1084f783]: Words in Sch. 7A para. 18(1)(a) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(15)(a) (with reg. 63)

[^key-1ea7bd492a6409438a928cf03370e2d0]: Word in Sch. 7A para. 18(3) omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(15)(b) (with reg. 63)

[^key-f2c183ae0d232306fd4450d82f6f189b]: Words in Sch. 7A para. 18(5) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(15)(c) (with reg. 63)

[^key-e0ae35b3f8647f0015167552cd9e23bd]: Word in Sch. 7A para. 19(1) omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(16) (with reg. 63)

[^key-502f30811a53b8df0486ac079e31cca8]: Word in Sch. 7A para. 19(4) omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(16) (with reg. 63)

[^key-51383d95026824d84bd220891969577a]: Word in Sch. 7A para. 20 omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(17)(a) (with reg. 63)

[^key-06cf3e047c0c38d9ffbfdcd0cdf5da8b]: Word in Sch. 7A para. 20 substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(17)(b) (with reg. 63)

[^key-17ee3cb054064eacac73422703566ae0]: Words in Sch. 7A para. 21 substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(18)(a) (with reg. 63)

[^key-8129fafd91d52a414176b7e22523babc]: Word in Sch. 7A para. 21 inserted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(18)(b) (with reg. 63)

[^key-75fa1b377fedba8d1ecb1c111bc8dad5]: Word in Sch. 7A para. 21 omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 59(18)(c) (with reg. 63)

[^key-505e5ade531e7f715f2b20439a90fd29]: Word in Sch. 9A para. 7(4)(a) omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(7) (with reg. 63)

[^key-0e67b1a032f81d762443f254ba439506]: Word in Sch. 9A para. 15 cross-heading omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(8) (with reg. 63)

[^key-93249b54db695c5008de0eaff2f05712]: Sch. 9A para. 15(3) inserted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(9) (with reg. 63)

[^key-8ee2430d09614717c8e4dc3eace361bf]: Words in Sch. 17A para. 11(3)(ba) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(10)(a) (with reg. 63)

[^key-660ecdb9763f7f58d5b417322406fe4b]: Words in Sch. 17A para. 11(4) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(10)(b) (with reg. 63)

[^key-e7ac4d4222a577a957caf9cf70dab516]: Words in Sch. 17A para. 11(5)(bb) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(10)(c)(i) (with reg. 63)

[^key-00ba0410cde7d1db26b654b5cbaa0fa8]: Word in Sch. 17A para. 11(5)(bb) omitted (19.3.2025) by virtue of The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(10)(c)(ii) (with reg. 63)

[^key-93ccaf239a59ed6a92eb5216e6e60cf4]: Words in Sch. 17A para. 11(6) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(10)(d) (with reg. 63)

[^key-d8ae4623ec339f1aa17381107f793db2]: Words in Sch. 17A para. 11(7) substituted (19.3.2025) by The Co-ownership Contractual Schemes (Tax) Regulations 2025 (S.I. 2025/200), regs. 1(2), 57(10)(e) (with reg. 63)

[^key-c360021950737d581fedb5e7270c6fd2]: S. 44(8) excluded (20.3.2025) by Finance Act 2025 (c. 8), s. 52(5)

[^key-6498897c3e21874df0edde77fc60eb1a]: S. 44(8) excluded (20.3.2025) by Finance Act 2025 (c. 8), s. 53(5)

[^key-90107e15901b749da3d546f851cc25a3]: S. 44(10) applied (20.3.2025) by Finance Act 2025 (c. 8), s. 52(6)

[^key-1105726278d858dc46fae967237892d2]: S. 44(10) applied (20.3.2025) by Finance Act 2025 (c. 8), s. 53(6)

[^key-b955a6d4809640b0d9badd68dc374d41]: Word in s. 74(1A) substituted (with effect in accordance with s. 53(2) of the amending Act) by Finance Act 2025 (c. 8), s. 53(1)(b)(2) (with s. 53(3)(4))

[^key-2cf040869f09e5ddfa5b1ade599ef21a]: Word in Sch. 4A para. 3(1)(a) substituted (with effect in accordance with s. 53(2) of the amending Act) by Finance Act 2025 (c. 8), s. 53(1)(a)(2) (with s. 53(3)(4))

[^key-9e4f1892d52264bb68138ef3ccf9c7fd]: Words in Sch. 4ZA para. 1(2) substituted (with effect in accordance with s. 51(2) of the amending Act) by Finance Act 2025 (c. 8), s. 51(1)(2) (with s. 51(3)-(5), 52)

[^key-b4e20a574f3fbf4639e25d60a79acf83]: S. 44(8) excluded (10.6.2021) by 2020 c. 15, s. 1A (as inserted by 2021 c. 26, s. 87(3) and as amended (20.3.2025) by 2025 c. 8, s. 52(3))

57A

(1) The leaseback element of a sale and leaseback arrangement is exempt from charge if the qualifying conditions specified below are met.

(2) A “sale and leaseback”arrangement means an arrangement under which—

(a) A transfers or grants to B a major interest in land (the “sale”), and

(b) out of that interest B grants a lease to A (the “leaseback”).

(3) The qualifying conditions are—

(a) that the sale transaction is entered into wholly or partly in consideration of the leaseback transaction being entered into,

(aa) that the sale transaction is entered into wholly or partly in consideration of the leaseback transaction being entered into,

(b) that the only other consideration (if any) for the sale is the payment of money or the assumption, satisfaction or release of a debt (or both),

(c) that the sale is not a transfer of rights within the meaning of ... 45A (contract providing for conveyance to third party: effect of transfer of rights) or a pre-completion transaction within the meaning of Schedule 2A (transactions entered into before completion of contract), and

(d) where A and B are both bodies corporate at the effective date of the leaseback transaction, that they are not members of the same group for the purposes of group relief (see paragraph 1 of Schedule 7) at that date.

(e) where A and B are both bodies corporate at the effective date of the leaseback transaction, that they are not members of the same group for the purposes of group relief (see paragraph 1 of Schedule 7) at that date.

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

58A

Schedule 6A provides for relief in the case of certain acquisitions of residential property.

64A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

81A

(1) Where the effect of a transaction (“the later transaction”) that is linked to an earlier transaction is that the earlier transaction becomes notifiable, the purchaser under the earlier transaction must deliver a return in respect of that transaction before the end of the period of 14 days after the effective date of the later transaction.

(1A) Where the effect of a transaction (“the later transaction”) that is linked to an earlier transaction is that—

(a) tax is payable in respect of the earlier transaction where none was payable before and subsection (1) does not apply, or

(b) additional tax is payable in respect of the earlier transaction,

the purchaser under the earlier transaction must deliver a further return in respect of that transaction before the end of the period of 30 days after the effective date of the later transaction.

(1B) For the purposes of subsections (1) and (1A), any tax or additional tax payable is calculated according to the effective date of the earlier transaction.

(1C) Where a purchaser is required to deliver a return under subsection (1) or a further return under subsection (1A)—

(a) that return must include a self-assessment of the amount of tax chargeable as a result of the later transaction, and

(b) the tax or additional tax payable must be paid not later than the filing date for that return.

(2) The provisions of Schedule 10 (returns, enquiries, assessments and other matters) apply to a return under this section as they apply to a return under section 76 (general requirement to deliver land transaction return), with the following adaptations—

(a) in paragraph 5 (formal notice to deliver return), the requirement in sub-paragraph (2)(a) that the notice specify the transaction to which it relates shall be read as requiring both the earlier and later transactions to be specified;

(b) references to the effective date of the transaction to which the return relates shall be read as references to the effective date of the later transaction.

(3) This section does not affect any requirement to make a return under section 76 in respect of the later transaction.

81B

(1) This section applies to the declaration mentioned in paragraph 1(1)(c) of Schedule 10 ... (declaration that return ... is correct and complete).

(2) The requirement that an individual make such a declaration (alone or jointly with others) is treated as met if a declaration to that effect is made by a person authorised to act on behalf of that individual in relation to the matters to which the return or certificate relates.

(3) For the purposes of this section a person is not regarded as authorised to act on behalf of an individual unless he is so authorised by a power of attorney in writing, signed by that individual.

In this subsection as it applies in Scotland “power of attorney” includes factory and commission.

(4) Nothing in this section affects the making of a declaration in accordance with—

(a) section 100(2) (persons through whom a company acts), or

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE 6A

Acquisition by house-building company from individual acquiring new dwelling

1

(1) Where a dwelling (“the old dwelling”) is acquired by a house-building company from an individual (whether alone or with other individuals), the acquisition is exempt from charge if the following conditions are met.

(2) The conditions are—

(a) that the individual (whether alone or with other individuals) acquires from the house-building company a new dwelling,

(b) that the individual—

(i) occupied the old dwelling as his only or main residence at some time in the period of two years ending with the date of its acquisition, and

(ii) intends to occupy the new dwelling as his only or main residence,

(d) that the area of land acquired by the house-building company does not exceed the permitted area.

(3) Where the conditions in sub-paragraph (2)(a) to (c) are met but the area of land acquired by the house-building company exceeds the permitted area, the chargeable consideration for the acquisition is taken to be the amount calculated by deducting the market value of the permitted area from the market value of the old dwelling.

(4) A “house-building company” means a company that carries on the business of constructing or adapting buildings or parts of buildings for use as dwellings.

References in this paragraph to such a company include any company connected with it.

(5) In this paragraph—

(a) references to the acquisition of the new dwelling are to the acquisition, by way of grant or transfer, of a major interest in the dwelling;

(b) references to the acquisition of the old dwelling are to the acquisition, by way of transfer, of a major interest in the dwelling; and

(c) references to the market value of the old dwelling and of the permitted area are, respectively, to the market value of that major interest in the dwelling and of that interest so far as it relates to that area.

Acquisition by property trader from individual acquiring new dwelling

2

(1) Where a dwelling (“the old dwelling”) is acquired by a property trader from an individual (whether alone or with other individuals), the acquisition is exempt from charge if the following conditions are met.

(2) The conditions are—

(a) that the acquisition is made in the course of a business that consists of or includes acquiring dwellings from individuals who acquire new dwellings from house-building companies,

(b) that the individual (whether alone or with other individuals) acquires a new dwelling from a house-building company,

(i) occupied the old dwelling as his only or main residence at some time in the period of two years ending with the date of its acquisition, and

(ii) intends to occupy the new dwelling as his only or main residence,

(d) that the property trader does not intend—

(i) to spend more than the permitted amount on refurbishment of the old dwelling, or

(ii) to grant a lease or licence of the old dwelling, or

(iii) to permit any of its principals or employees (or any person connected with any of its principals or employees) to occupy the old dwelling, and

(e) that the area of land acquired by the property trader does not exceed the permitted area.

(3) Where the conditions in sub-paragraph (2)(a) to (d) are met, but the area of land acquired by the property trader exceeds the permitted area, the chargeable consideration for the acquisition is taken to be the amount calculated by deducting the market value of the permitted area from the market value of the old dwelling.

(4) The provisions of paragraph 1(4) (meaning of “house-building company” etc.) also have effect for the purposes of this paragraph.

(5) In this paragraph—

(a) references to the acquisition of a new dwelling are to the acquisition, by way of grant or transfer, of a major interest in the dwelling;

(b) references to the acquisition of the old dwelling are to the acquisition, by way of transfer, of a major interest in the dwelling; and

(c) references to the market value of the old dwelling and of the permitted area are, respectively, to the market value of that major interest in the dwelling and of that interest so far as it relates to that area.

Acquisition by property trader from personal representatives

3

(1) Where a dwelling is acquired by a property trader from the personal representatives of a deceased individual, the acquisition is exempt from charge if the following conditions are met.

(2) The conditions are—

(a) that the acquisition is made in the course of a business that consists of or includes acquiring dwellings from personal representatives of deceased individuals,

(b) that the deceased individual occupied the dwelling as his only or main residence at some time in the period of two years ending with the date of his death,

(i) to spend more than the permitted amount on refurbishment of the dwelling, or

(ii) to grant a lease or licence of the dwelling, or

(iii) to permit any of its principals or employees (or any person connected with any of its principals or employees) to occupy the dwelling, and

(d) that the area of land acquired does not exceed the permitted area.

(3) Where the conditions in sub-paragraph (2)(a) to (c) are met, but the area of land acquired exceeds the permitted area, the chargeable consideration for the acquisition is taken to be the amount calculated by deducting the market value of the permitted area from the market value of the dwelling.

(4) In this paragraph—

(a) references to the acquisition of the dwelling are to the acquisition, by way of transfer, of a major interest in the dwelling; and

(b) references to the market value of the dwelling and of the permitted area are, respectively, to the market value of that major interest in the dwelling and of that interest so far as it relates to that area.

Acquisition by property trader from individual where chain of transactions breaks down

4

(1) Where a dwelling (“the old dwelling”) is acquired by a property trader from an individual (whether alone or with other individuals), the acquisition is exempt from charge if—

(a) the individual has made arrangements to sell a dwelling (“the old dwelling”) and acquire another dwelling (“the second dwelling”),

(b) the arrangements to sell the old dwelling fail, and

(c) the acquisition of the old dwelling is made for the purpose of enabling the individual’s acquisition of the second dwelling to proceed,

and the following conditions are met.

(2) The conditions are—

(a) that the acquisition is made in the course of a business that consists of or includes acquiring dwellings from individuals in those circumstances,

(b) that the individual—

(i) occupied the old dwelling as his only or main residence at some time in the period of two years ending with the date of its acquisition, and

(ii) intends to occupy the second dwelling as his only or main residence,

(i) to spend more than the permitted amount on refurbishment of the old dwelling, or

(ii) to grant a lease or licence of the old dwelling, or

(iii) to permit any of its principals or employees (or any person connected with any of its principals or employees) to occupy the old dwelling, and

(d) that the area of land acquired does not exceed the permitted area.

(3) Where the conditions in sub-paragraph (2)(a) to (c) are met, but the area of land acquired exceeds the permitted area, the chargeable consideration for the acquisition is taken to be the amount calculated by deducting the market value of the permitted area from the market value of the old dwelling.

(4) In this paragraph—

(a) references to the acquisition of the second dwelling are to the acquisition, by way of grant or transfer, of a major interest in the dwelling;

(b) references to the acquisition of the old dwelling are to the acquisition, by way of transfer, of a major interest in the dwelling; and

(c) references to the market value of the old dwelling and of the permitted area are, respectively, to the market value of that major interest in the dwelling and of that interest so far as it relates to that area.

Acquisition by employer in case of relocation of employment

5

(1) Where a dwelling is acquired from an individual (whether alone or with other individuals) by his employer, the acquisition is exempt from charge if the following conditions are met.

(2) The conditions are—

(a) that the individual occupied the dwelling as his only or main residence at some time in the period of two years ending with the date of the acquisition,

(b) that the acquisition is made in connection with a change of residence by the individual resulting from relocation of employment,

(d) that the area of land acquired does not exceed the permitted area.

(3) Where the conditions in sub-paragraph (2)(a) to (c) are met but the area of land acquired exceeds the permitted area, the chargeable consideration for the acquisition is taken to be the amount calculated by deducting the market value of the permitted area from the market value of the dwelling.

(4) In this paragraph “relocation of employment” means a change of the individual’s place of employment due to—

(a) his becoming an employee of the employer,

(b) an alteration of the duties of his employment with the employer, or

(5) For the purposes of this paragraph a change of residence is one “resulting from” relocation of employment if—

(a) the change is made wholly or mainly to allow the individual to have his residence within a reasonable daily travelling distance of his new place of employment, and

(b) his former residence is not within a reasonable daily travelling distance of that place.

The individual’s “new place of employment” means the place where he normally performs, or is normally to perform, the duties of his employment after the relocation.

(6) In this paragraph—

(a) references to the acquisition of the dwelling are to the acquisition, by way of transfer, of a major interest in the dwelling;

(b) references to the market value of the dwelling and of the permitted area are, respectively, to the market value of that major interest in the dwelling and of that interest so far as it relates to that area; and

Acquisition by property trader in case of relocation of employment

6

(1) Where a dwelling is acquired by a property trader from an individual (whether alone or with other individuals), the acquisition is exempt from charge if the following conditions are met.

(2) The conditions are—

(a) that the acquisition is made in the course of a business that consists of or includes acquiring dwellings from individuals in connection with a change of residence resulting from relocation of employment,

(b) that the individual occupied the dwelling as his only or main residence at some time in the period of two years ending with the date of the acquisition,

(c) that the acquisition is made in connection with a change of residence by the individual resulting from relocation of employment,

(d) that the consideration for the acquisition does not exceed the market value of the dwelling,

(e) that the property trader does not intend—

(i) to spend more than the permitted amount on refurbishment of the dwelling, or

(ii) to grant a lease or licence of the dwelling, or

(iii) to permit any of its principals or employees (or any person connected with any of its principals or employees) to occupy the dwelling, and

(f) that the area of land acquired does not exceed the permitted area.

(3) Where the conditions in sub-paragraph (2)(a) to (e) are met but the area of land acquired exceeds the permitted area, the chargeable consideration for the acquisition is taken to be the amount calculated by deducting the market value of the permitted area from the market value of the dwelling.

(4) In this paragraph “relocation of employment” means a change of the individual’s place of employment due to—

(a) his becoming employed by a new employer,

(b) an alteration of the duties of his employment, or

(5) For the purposes of this paragraph a change of residence is one “resulting from” relocation of employment if—

(a) the change is made wholly or mainly to allow the individual to have his residence within a reasonable daily travelling distance of his new place of employment, and

(b) his former residence is not within a reasonable daily travelling distance of that place.

An individual’s “new place of employment” means the place where he normally performs, or is normally to perform, the duties of his employment after the relocation.

(6) In this paragraph—

(a) references to the acquisition of the dwelling are to the acquisition, by way of transfer, of a major interest in the dwelling; and

(b) references to the market value of the dwelling and of the permitted area are, respectively, to the market value of that major interest in the dwelling and of that interest so far as it relates to that area.

Meaning of “dwelling”, “new dwelling” and “the permitted area”

7

(1) “Dwelling” includes land occupied and enjoyed with the dwelling as its garden or grounds.

(2) A building or part of a building is a “new dwelling” if—

(a) it has been constructed for use as a single dwelling and has not previously been occupied, or

(b) it has been adapted for use as a single dwelling and has not been occupied since its adaptation.

(3) “The permitted area”, in relation to a dwelling, means land occupied and enjoyed with the dwelling as its garden or grounds that does not exceed—

(a) an area (inclusive of the site of the dwelling) of 0.5 of a hectare, or

(b) such larger area as is required for the reasonable enjoyment of the dwelling as a dwelling having regard to its size and character.

(4) Where sub-paragraph (3)(b) applies, the permitted area is taken to consist of that part of the land that would be the most suitable for occupation and enjoyment with the dwelling as its garden or grounds if the rest of the land were separately occupied.

Meaning of “property trader” and “principal”

8

(1) A “property trader” means—

(a) a company,

(b) a limited liability partnership, or

that carries on the business of buying and selling dwellings.

(2) In relation to a property trader a “principal” means—

(a) in the case of a company, a director;

(b) in the case of a limited liability partnership, a member;

(c) in the case of a partnership whose members are all either companies or limited liability partnerships, a member or a person who is a principal of a member.

(3) For the purposes of this Schedule—

(a) anything done by or in relation to a company connected with a property trader is treated as done by or in relation to that property trader, and

(b) references to the principals or employees of a property trader include the principals or employees of any such company.

Meaning of “refurbishment” and “the permitted amount”

9

(1) “Refurbishment” of a dwelling means the carrying out of works that enhance or are intended to enhance the value of the dwelling, but does not include—

(a) cleaning the dwelling, or

(b) works required solely for the purpose of ensuring that the dwelling meets minimum safety standards.

(2) “The permitted amount”, in relation to the refurbishment of a dwelling, is—

(a) £10,000, or

(b) 5% of the consideration for the acquisition of the dwelling,

whichever is the greater, but subject to a maximum of £20,000.

Connected companies etc.

10

Section 839 of the Taxes Act 1988 (connected persons) has effect for the purposes of this Schedule.

Withdrawal of relief under this Schedule

11

(1) Relief under this Schedule is withdrawn in the following circumstances.

(2) Relief under paragraph 2 (acquisition by property trader from individual acquiring new dwelling) is withdrawn if the property trader—

(a) spends more than the permitted amount on refurbishment of the old dwelling, or

(b) grants a lease or licence of the old dwelling, or

(c) permits any of its principals or employees (or any person connected with any of its principals or employees) to occupy the old dwelling.

(3) Relief under paragraph 3 (acquisition by property trader from personal representatives) is withdrawn if the property trader—

(a) spends more than the permitted amount on refurbishment of the dwelling, or

(b) grants a lease or licence of the dwelling, or

(c) permits any of its principals or employees (or any person connected with any of its principals or employees) to occupy the dwelling.

(4) Relief under paragraph 4 (acquisition by property trader from individual where chain of transactions breaks down) is withdrawn if the property trader—

(a) spends more than the permitted amount on refurbishment of the old dwelling, or

(b) grants a lease or licence of the old dwelling, or

(c) permits any of its principals or employees (or any person connected with any of its principals or employees) to occupy the old dwelling.

(5) Relief under paragraph 6 (acquisition by property trader in case of relocation of employment) is withdrawn if the property trader—

(a) spends more than the permitted amount on refurbishment of the dwelling, or

(b) grants a lease or licence of the dwelling, or

(c) permits any of its principals or employees (or any person connected with any of its principals or employees) to occupy the dwelling.

(6) Where relief is withdrawn the amount of tax chargeable is the amount that would have been chargeable in respect of the acquisition but for the relief.

SCHEDULE 17A

Meaning of “lease”

1

In this Part “lease” means—

(a) an interest or right in or over land for a term of years (whether fixed or periodic), or

(b) a tenancy at will or other interest or right in or over land terminable by notice at any time.

Leases for a fixed term

2

In the application of the provisions of this Part to a lease for a fixed term, no account shall be taken of—

(a) any contingency as a result of which the lease may determine before the end of the fixed term, or

(b) any right of either party to determine the lease or renew it.

Leases that continue after a fixed term

3

(1) This paragraph applies to—

(a) a lease for a fixed term and thereafter until determined, or

(b) a lease for a fixed term that may continue beyond the fixed term by operation of law.

(2) For the purposes of this Part (except sections 77 and 77A (notifiable transactions)), a lease to which this paragraph applies is treated—

(a) in the first instance as if it were a lease for the original fixed term and no longer,

(b) if the lease continues after the end of that term, as if it were a lease for a fixed term one year longer than the original fixed term,

(c) if the lease continues after the end of the term resulting from the application of paragraph (b), as if it were a lease for a fixed term two years longer than the original fixed term,

and so on.

(3) Where the effect of sub-paragraph (2) in relation to the continuation of the lease for a period (or further period) of one year after the end of a fixed term is that a transaction becomes notifiable, the purchaser must deliver a return in respect of that transaction before the end of the period of 14 days after the end of that one year period.

(3ZA) Where the effect of sub-paragraph (2) in relation to the continuation of the lease for a period (or further period) of one year after the end of a fixed term is that—

(a) tax is payable in respect of a transaction where none was payable before and sub-paragraph (3) does not apply, or

(b) additional tax is payable in respect of a transaction,

the purchaser must deliver a further return in respect of that transaction before the end of the period of 30 days after the end of that one year period.

(3ZB) For the purposes of sub-paragraphs (3) and (3ZA), any tax or additional tax payable is calculated according to the effective date of the transaction.

(3ZC) Where a purchaser is required to deliver a return under sub-paragraph (3) or a further return under sub-paragraph (3ZA)—

(a) that return must include a self-assessment of the amount of tax chargeable in respect of the transaction on the basis of the information contained in the return, and

(b) the tax or additional tax payable must be paid not later than the filing date for that return.

(3A) But no tax or additional tax is payable in respect of a transaction as a result of the continuation of a lease for a period (or further period) of one year under sub-paragraph (2) if, during that one year period, the tenant under the lease is granted a new lease of the same or substantially the same premises in circumstances where paragraph 9A applies.

(3B) Sub-paragraph (2) is subject to paragraph 3A.

(4) The provisions of Schedule 10 (returns, enquiries, assessments and other matters) apply to a return under this paragraph as they apply to a return under section 76 (general requirement to deliver land transaction return), with the adaptation that references to the effective date of the transaction shall be read as references to the last day of the one year period for which the lease is continued or (as the case may be) further continued.

(5) For the purposes of sections 77 and 77A (notifiable transactions) a lease to which this paragraph applies is a lease for whatever is its fixed term.

(6) Where—

(a) a lease would be treated as continuing for a period (or further period) of one year under sub-paragraph (2), but

(b) (ignoring that sub-paragraph) the lease actually terminates at a time during that period,

the lease is to be treated as continuing under sub-paragraph (2) only until that time; and the references in sub-paragraphs (3) and (4) to that one year period are accordingly to be read as references to so much of that year as ends with that time.

Treatment of leases for indefinite term

4

(1) For the purposes of this Part (except sections 77 and 77A (notifiable transactions))—

(a) a lease for an indefinite term is treated in the first instance as if it were a lease for a fixed term of a year,

(b) if the lease continues after the end of the term resulting from the application of paragraph (a), it is treated as if it were a lease for a fixed term of two years,

(c) if the lease continues after the end of the term resulting from the application of paragraph (b), it is treated as if it were a lease for a fixed term of three years,

and so on.

(2) No account shall be taken for the purposes of this Part of any other statutory provision in England and Wales or Northern Ireland deeming a lease for an indefinite period to be a lease for a different term.

(3) Where the effect of sub-paragraph (1) in relation to the continuation of the lease after the end of a deemed fixed term is that a transaction becomes notifiable, the purchaser must deliver a return in respect of that transaction before the end of the period of 14 days after the end of that term.

(3A) Where the effect of sub-paragraph (1) in relation to the continuation of the lease after the end of a deemed fixed term is that—

(a) tax is payable in respect of a transaction where none was payable before and sub-paragraph (3) does not apply, or

(b) additional tax is payable in respect of a transaction,

the purchaser must deliver a further return in respect of that transaction before the end of the period of 30 days after the end of that term.

(3B) For the purposes of sub-paragraphs (3) and (3A), any tax or additional tax payable is calculated according to the effective date of the transaction.

(3C) Where a purchaser is required to deliver a return under sub-paragraph (3) or a further return under sub-paragraph (3A)—

(a) that return must include a self-assessment of the amount of tax chargeable in respect of the transaction on the basis of the information contained in the return, and

(b) the tax or additional tax payable must be paid not later than the filing date for that return.

(4) The provisions of Schedule 10 (returns, enquiries, assessments and other matters) apply to a return under this paragraph as they apply to a return under section 76 (general requirement to deliver land transaction return), with the adaptation that references to the effective date of the transaction shall be read as references to the day on which the lease becomes treated as being for a longer fixed term.

(4A) For the purposes of sections 77 and 77A (notifiable transactions) a lease for an indefinite term is a lease for a term of less then seven years.

(5) References in this paragraph to a lease for an indefinite period include—

(a) a periodic tenancy or other interest or right terminable by a period of notice,

(b) a tenancy at will ..., or

Treatment of successive linked leases

5

(1) This paragraph applies where—

(a) successive leases are granted or treated as granted (whether at the same time or at different times) of the same or substantially the same premises, and

(b) those grants are linked transactions.

(2) This Part applies as if the series of leases were a single lease—

(a) granted at the time of the grant of the first lease in the series,

(b) for a term equal to the aggregate of the terms of all the leases, and

(3) The grant of later leases in the series is accordingly disregarded for the purposes of this Part except section 81A (return or further return in consequence of later linked transaction).

Rent

6

(1) For the purposes of this Part a single sum expressed to be payable in respect of rent, or expressed to be payable in respect of rent and other matters but not apportioned, shall be treated as entirely rent.

(2) Sub-paragraph (1) is without prejudice to the application of paragraph 4 of Schedule 4 (chargeable consideration: just and reasonable apportionment) where separate sums are expressed to be payable in respect of rent and other matters.

Variable or uncertain rent

7

(1) This paragraph applies to determine the amount of rent payable under a lease where that amount—

(a) varies in accordance with provision in the lease, or

(b) is contingent, uncertain or unascertained.

(2) As regards rent payable in respect of any period before the end of the fifth year of the term of the lease—

(a) the provisions of this Part apply as in relation to other chargeable consideration, and

(b) the provisions of section 51 (1) and (2) accordingly apply if the amount is contingent, uncertain or unascertained.

(3) As regards rent payable in respect of any period after the end of the fifth year of the term of the lease, the annual amount is assumed for the purposes of this Part to be, in every case, equal to the highest amount of rent payable in respect of any consecutive twelve month period in the first five years of the term.

In determining that amount take into account (if necessary) any amounts determined as mentioned in sub-paragraph (2)(b), but disregard paragraphs 9(2) and 9A(3) (deemed reduction of rent, where further lease granted, for period during which rents overlap).

(4) This paragraph has effect subject to paragraph 8 (adjustment where rent payable ceases to be uncertain).

(4A) For the purposes of this paragraph and paragraph 8, the cases where the amount of rent payable under a lease is uncertain or unascertained include cases where there is a possibility of that amount being varied under—

(a) section 12, 13 or 33 of the Agricultural Holdings Act 1986,

(b) Part 2 of the Agricultural Tenancies Act 1995,

(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) No account shall be taken for the purposes of this Part of any provision for rent to be adjusted in line with the retail prices index.

Adjustment where rent ceases to be uncertain

8

(1) Where the provisions of section 51 (1) and (2) (contingent, uncertain or unascertained consideration) apply in relation to a transaction by virtue of paragraph 7 (uncertain rent) and—

(a) the end of the fifth year of the term of the lease is reached, or

(b) the amount of rent payable in respect of the first five years of the term of the lease ceases to be uncertain at an earlier date,

the following provisions have effect to require or permit reconsideration of how this Part applies to the transaction (and to any transaction in relation to which it is a linked transaction).

(2) For the purposes of this paragraph the amount of rent payable ceases to be uncertain when—

(a) in the case of contingent rent, the contingency occurs or it becomes clear that it will not occur, and

(b) in the case of uncertain or unascertained rent, the amount becomes ascertained.

(3) If the result as regards the rent paid or payable in respect of the first five years of the term of the lease is that a transaction becomes notifiable, the purchaser must make a return to HMRC within 14 days of the date referred to in sub-paragraph (1)(a) or (b).

(3A) If the result as regards the rent paid or payable in respect of the first five years of the term of the lease is that—

(a) tax is payable in respect of a transaction where none was payable before and sub-paragraph (3) does not apply, or

(b) additional tax is payable in respect of a transaction,

the purchaser must make a further return to HMRC within 30 days of the date referred to in sub-paragraph (1)(a) or (b).

(3B) If a purchaser is required to make a return under sub-paragraph (3) or a further return under sub-paragraph (3A)—

(a) that return must contain a self-assessment of the tax chargeable in respect of the transaction on the basis of the information contained in the return,

(b) the tax so chargeable is to be calculated by reference to the rates in force at the effective date of the transaction, and

(4) The provisions of Schedule 10 (returns, enquiries, assessment and other matters) apply to a return under this paragraph as they apply to a return under section 76 (general requirement to make land transaction return), subject to the adaptation that references to the effective date of the transaction shall be read as references to the date referred to in sub-paragraph (1)(a) or (b).

(5) If the result as regards the rent paid or payable in respect of the first five years of the term of the lease is that less tax is payable in respect of the transaction than has already been paid—

(a) the purchaser may, within the period allowed for amendment of the land transaction return, amend the return accordingly;

(b) after the end of that period he may (if the land transaction return is not so amended) make a claim to the Inland Revenue for repayment of the amount overpaid.

Rent for overlap period in case of grant of further lease

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(1) This paragraph applies where—

(a) A surrenders an existing lease to B (“the old lease”) and in consideration of that surrender B grants a lease to A of the same or substantially the same premises (“the new lease”),

(b) the tenant under a lease (“the old lease”) of premises to which Part 2 of the Landlord and Tenant Act 1954 or the Business Tenancies (Northern Ireland) Order 1996 applies makes a request for a new tenancy (“the new lease”) which is duly executed,

(c) on termination of a lease (“the head lease”) a sub-tenant is granted a lease (“the new lease”) of the same or substantially the same premises as those comprised in his original lease (“the old lease”)—

(i) in pursuance of an order of a court on a claim for relief against re-entry or forfeiture, or

(ii) in pursuance of a contractual entitlement arising in the event of the head lease being terminated,

(d) a person who has guaranteed the obligations of a lessee under a lease that has been terminated (“the old lease”) is granted a lease of the same or substantially the same premises (“the new lease”) in pursuance of the guarantee.

(2) For the purposes of this Part the rent payable under the new lease in respect of any period falling within the overlap period is treated as reduced by the amount of the rent that would have been payable in respect of that period under the old lease.

(3) The overlap period is the period between the date of grant of the new lease and what would have been the end of the term of the old lease had it not been terminated.

(4) The rent that would have been payable under the old lease shall be taken to be the amount taken into account in determining the stamp duty land tax chargeable in respect of the acquisition of the old lease.

(5) This paragraph does not have effect so as to require the rent payable under the new lease to be treated as a negative amount.

Tenants' obligations etc that do not count as chargeable consideration

10

(1) In the case of the grant of a lease none of the following counts as chargeable consideration—

(a) any undertaking by the tenant to repair, maintain or insure the demised premises ...;

(b) any undertaking by the tenant to pay any amount in respect of services, repairs, maintenance or insurance or the landlord’s costs of management;

(c) any other obligation undertaken by the tenant that is not such as to affect the rent that a tenant would be prepared to pay in the open market;

(d) any guarantee of the payment of rent or the performance of any other obligation of the tenant under the lease;

(e) any penal rent, or increased rent in the nature of a penal rent, payable in respect of the breach of any obligation of the tenant under the lease.

(f) any liability of the tenant for costs under section 14(2) of the Leasehold Reform Act 1967 or section 60 of the Leasehold Reform, Housing and Urban Development Act 1993 (costs to be borne by person exercising statutory right to be granted lease);

(g) any other obligation of the tenant to bear the landlord’s reasonable costs or expenses of or incidental to the grant of a lease;

(h) any obligation under the lease to transfer to the landlord, on the termination of the lease, payment entitlements granted to the tenant under the single payment scheme (that is, the scheme of income support for farmers in pursuance of Title III of Council Regulation (EC) No 73/2009 ) in respect of land subject to thelease.

(2) Where sub-paragraph (1) applies in relation to an obligation, a payment made in discharge of the obligation does not count as chargeable consideration.

(3) The release of any such obligation as is mentioned in sub-paragraph (1) does not count as chargeable consideration in relation to the surrender of the lease.

Cases where assignment of lease treated as grant of lease

11

(1) This paragraph applies where the grant of a lease is exempt from charge by virtue of any of the provisions specified in sub-paragraph (3).

(2) The first assignment of the lease that is not exempt from charge by virtue of any of the provisions specified in sub-paragraph (3), and in relation to which the assignee does not acquire the lease as a bare trustee of the assignor, is treated for the purposes of this Part as if it were the grant of a lease by the assignor—

(a) for a term equal to the unexpired term of the lease referred to in sub-paragraph (1), and

(b) on the same terms as those on which the assignee holds that lease after the assignment.

(3) The provisions are—

(a) section 57A (sale and leaseback arrangements);

(b) Part 1 or 2 of Schedule 7 (group relief or reconstruction or acquisition relief);

(ba) Part 1 or 2 of Schedule 7A (PAIF seeding relief and co-ownership scheme seeding relief);

(d) Schedule 8 (charities relief);

(e) any such regulations as are mentioned in section 123(3) (regulations reproducing in relation to stamp duty land tax the effect of enactments providing for exemption from stamp duty).

(4) This paragraph does not apply where the relief in question is group relief, reconstruction or acquisition relief , PAIF seeding relief, co-ownership scheme seeding relief or charities relief and is withdrawn as a result of a disqualifying event occurring before the effective date of the assignment.

(5) For the purposes of sub-paragraph (4) “disqualifying event” means—

(a) in relation to the withdrawal of group relief, the event falling within paragraph 3(1)(a) of Schedule 7 (purchaser ceasing to be a member of the same group as the vendor), as read with paragraph 4A of that Schedule;

(b) in relation to the withdrawal of reconstruction or acquisition relief, the change of control of the acquiring company mentioned in paragraph 9(1)(a) of that Schedule or, as the case may be, the event mentioned in paragraph 11(1)(a) or (2)(a) of that Schedule;

(ba) in relation to the withdrawal of PAIF seeding relief—

(i) the purchaser ceasing to be a property AIF as mentioned in paragraph 5 of Schedule 7A,

(ii) a person making a relevant disposal of units as mentioned in paragraph 7 of that Schedule, or

(iii) the grant of permission to a non-qualifying individual to occupy a dwelling as mentioned in paragraph 8 of that Schedule;

(bb) in relation to the withdrawal of co-ownership scheme seeding relief—

(i) the purchaser ceasing to be a co-ownership ... contractual scheme as mentioned in paragraph 13 of Schedule 7A,

(ii) a person making a relevant disposal of units as mentioned in paragraph 17 of that Schedule, or

(iii) the grant of permission to a non-qualifying individual to occupy a dwelling as mentioned in paragraph 18 of that Schedule;

(c) in relation to the withdrawal of charities relief, a disqualifying event as defined in paragraphs 2(3) or 3(2) of Schedule 8.

(6) This paragraph also does not apply where the relief in question is PAIF seeding relief or co-ownership scheme seeding relief and is withdrawn as a result of a requirement not being met at a time which is before the effective date of the assignment of the lease.

(7) For the purposes of sub-paragraph (6), the reference to a requirement not being met is a reference to—

(a) in relation to the withdrawal of PAIF seeding relief under paragraph 6 of Schedule 7A, the portfolio test not being met (see paragraph 6(7));

(b) in relation to the withdrawal of co-ownership scheme seeding relief under paragraph 14 of Schedule 7A, the genuine diversity of ownership condition not being met (see paragraph 15);

(c) in relation to the withdrawal of co-ownership scheme seeding relief under paragraph 16 of Schedule 7A, the portfolio test not being met (see paragraph 16(7)).

Assignment of lease: responsibility of assignee for returns etc

12

(1) Where a lease is assigned, anything that but for the assignment would be required or authorised to be done by or in relation to the assignor under or by virtue of—

(a) section 80 (adjustment where contingency ceases or consideration is ascertained),

(b) section 81A (return or further return in consequence of later linked transaction),

(c) paragraph 3 or 4 of this Schedule (return or further return required where lease for indefinite period continues), or

(d) paragraph 8 of this Schedule (adjustment where rent ceases to be uncertain),

shall, if the event giving rise to the adjustment or return occurs after the effective date of the assignment, be done instead by or in relation to the assignee.

(2) So far as necessary for giving effect to sub-paragraph (1) anything previously done by or in relation to the assignor shall be treated as if it had been done by or in relation to the assignee.

(3) This paragraph does not apply if the assignment falls to be treated as the grant of a lease by the assignor (see paragraph 11).

Increase of rent treated as grant of new lease: variation of lease in first five years

13

(1) Where a lease is varied so as to increase the amount of the rent as from a date before the end of the fifth year of the term of the lease, the variation is treated for the purposes of this Part as if it were the grant of a lease in consideration of the additional rent made payable by it.

(2) Sub-paragraph (1) does not apply to an increase of rent in pursuance of—

(a) a provision contained in the lease, or

(b) a provision mentioned in paragraph (a) or (b) of paragraph 7(4A).

Increase of rent treated as grant of new lease: abnormal increase after fifth year

14

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Increase of rent after fifth year: whether regarded as abnormal

15

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Surrender of existing lease in return for new lease

16

Where a lease is granted in consideration of the surrender of an existing lease between the same parties—

(a) the grant of the new lease does not count as chargeable consideration for the surrender, and

(b) the surrender does not count as chargeable consideration for the grant of the new lease.

Assignment of lease: assumption of obligations by assignee

17

In the case of an assignment of a lease the assumption by the assignee of the obligation—

(a) to pay rent, or

(b) to perform or observe any other undertaking of the tenant under the lease,

does not count as chargeable consideration for the assignment.

Reverse premium

18

(1) In the case of the grant, assignment or surrender of a lease a reverse premium does not count as chargeable consideration.

(2) A “reverse premium” means—

(a) in relation to the grant of a lease, a premium moving from the landlord to the tenant;

(b) in relation to the assignment of a lease, a premium moving from the assignor to the assignee;

Provisions relating to leases in Scotland

19

(1) In the application of this Part to Scotland—

(a) any reference to the term of a lease is to the period of the lease, and

(b) any reference to the reversion on a lease is to the interest of the landlord in the property subject to the lease.

(2) Where in Scotland there is a lease constituted by concluded missives of let (“the first lease”) and at some later time a lease is executed (“the second lease”), the first lease is to be treated for the purposes of this Part as if it were a lease granted—

(a) on the date the missives of let were concluded,

(b) for a period which begins with that date and ends at the end of the period of the second lease, and

(c) in consideration of the total rent payable over that period and any other consideration given for the first lease or the second lease.

(2A) Where sub-paragraph (2) applies the grant of the second lease is disregarded for the purposes of this Part except section 81A (return or further return in consequence of later linked transaction).

(2B) For the purposes of section 81A—

(a) the grant of the first lease and the grant of the second lease are linked (whether or not they would be linked by virtue of section 108),

(b) the lessee under the second lease (rather than the lessee under the first lease) is liable for any tax or additional tax payable in respect of the first lease lease as a result of sub-paragraph (2), and

(c) the reference in section 81A(1)(a) to “the purchaser under the earlier transaction” is to be read, in relation to the first lease, as a reference to the lessee under the second lease.

(3) Where in Scotland—

(a) there is an agreement (including missives of let not constituting a lease) under which a lease is to be executed, and

(b) the agreement is substantially performed without a lease having been executed,

the agreement is treated as if it were the grant of a lease in accordance with the agreement (“the notional lease”), beginning with the date of substantial performance.

The effective date of the transaction is when the agreement is substantially performed.

(4) Where sub-paragraph (3) applies and at some later time a lease (“the actual lease”) is executed, this Part applies as if the notional lease were a lease granted—

(a) on the date the agreement was substantially performed,

(b) for a period which begins with that date and ends at the end of the period of the actual lease, and

(c) in consideration of the total rent payable over that period and any other consideration given for the agreement or the actual lease.

(4A) Where sub-paragraph (4) applies the grant of the second lease is disregarded for the purposes of this Part except section 81A (return or further return in consequence of later linked transaction).”

(4B) For the purposes of section 81A—

(a) the grant of the notional lease and the grant of the actual lease are linked (whether or not they would be linked by virtue of section 108),

(b) the lessee under the actual lease (rather than the lessee under the notional lease) is liable for any tax or additional tax payable in respect of the notional lease as a result of sub-paragraph (4), and

(c) the reference in section 81A(1)(a) to “the purchaser under the earlier transaction” is to be read, in relation to the notional lease, as a reference to the lessee under the actual lease.

(5) References in sub-paragraphs (2) to (4) to the execution of a lease are to the execution of a lease that either is in conformity with, or relates to substantially the same property and period as, the missives of let or other agreement.

(6) Where sub-paragraph (3) applies and the agreement is (to any extent) afterwards rescinded or annulled, or is for any other reason not carried into effect, the tax paid by virtue of that sub-paragraph shall (to that extent) be repaid by the Inland Revenue.

Repayment must be claimed by amendment of the land transaction return made in respect of the agreement.

Contracts substantially performed after implementation date

4A

Where—

(a) a transaction is effected in pursuance of a contract entered into before the first relevant date,

(b) the contract is substantially performed, without having been completed, after the implementation date, and

the effective date of the transaction shall be taken to be the date of the event referred to in paragraph (c) (and not the date of substantial performance).

Application of provisions in case of transfer of rights

4B

(1) This paragraph applies where section 44 (contract and conveyance) has effect in accordance with section 45 (effect of transfer of rights).

(2) Any reference in paragraph 3, 4 or 4A to the date when a contract was entered into (or made) shall be read, in relation to a contract deemed to exist by virtue of section 45(3) (deemed secondary contract with transferee), as a reference to the date of the assignment, subsale or other transaction in question.

Stamping of contract where transaction on completion subject to stamp duty land tax

7A

(1) This paragraph applies where—

(a) a contract that apart from paragraph 7 of Schedule 13 to the Finance Act 1999 (contracts chargeable as conveyances on sale) would not be chargeable with stamp duty is entered into before the implementation date,

(b) a conveyance made in conformity with the contract is effected on or after the implementation date, and

(c) the transaction effected on completion is an SDLT transaction or would be but for an exemption or relief from stamp duty land tax.

(2) If in those circumstances the contract is presented for stamping together with a Revenue certificate as to compliance with the provisions of this Part of this Act in relation to the transaction effected on completion—

(a) the payment of stamp duty land tax on that transaction or, as the case may be, the fact that no such tax was payable shall be denoted on the contract by a particular stamp, and

(b) the contract shall be deemed thereupon to be duly stamped.

(3) In this paragraph “conveyance” includes any instrument.

Meaning of “restricted shares”

Arrangements involving public or educational bodies

17

(1) This paragraph applies in any case where arrangements are entered into under which—

(a) there is a transfer, or the grant or assignment of a lease, of land by a qualifying body (“A”) to a non-qualifying body (“B”) (“the main transfer”),

(b) in consideration (whether in whole or in part) of the main transfer there is a grant by B to A of a lease or under-lease of the whole, or substantially the whole, of that land (“the leaseback”),

(d) some or all of the consideration given by A to B for the carrying out of those works or the provision of those services is consideration in money,

whether or not there is also a transfer, or the grant or assignment of a lease, of any other land by A to B (a “transfer of surplus land”).

(2) The following are qualifying bodies—

(a) public bodies within section 66,

(b) institutions within the further education sector or the higher education sector within the meaning of 91 of the Further and Higher Education Act 1992,

(ca) sixth form college corporations within the meaning of section 90 of that Act,

(d) higher education corporations within the meaning section 90 of that Act,

(e) persons who undertake to establish and maintain, and carry on, or provide for the carrying on, of an Academy within the meaning of section 1 of the Academies Act 2010 , and

(f) in Scotland, institutions funded by the Scottish Further Education Funding Council or the Scottish Higher Education Funding Council.

(3) The following shall not count as chargeable consideration for the main transfer or any transfer of surplus land—

(a) the lease-back;

(b) the carrying out of building works by B for A; or

(4) The chargeable consideration for the lease back does not include—

(a) the main transfer;

(b) any transfer of surplus land; or

(4A) Sub-paragraphs (3) and (4) shall be disregarded for the purposes of determining whether the land transaction in question is notifiable.

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) In this paragraph “under-lease” includes a sub-lease.

Bringing of appeals

44A

(1) This section applies where a contract is entered into under which a chargeable interest is to be conveyed by one party to the contract (A) at the direction or request of the other (B)—

(a) to a person (C) who is not a party to the contract, or

(b) either to such a person or to B.

(2) B is not regarded as entering into a land transaction by reason of entering into the contract, but the following provisions have effect.

(3) If the contract is substantially performed B is treated for the purposes of this Part as acquiring a chargeable interest, and accordingly as entering into a land transaction.

The effective date of the transaction is when the contract is substantially performed.

(4) Where the contract is (to any extent) afterwards rescinded or annulled, or is for any other reason not carried into effect, the tax paid by virtue of subsection (3) shall (to that extent) be repaid by the Inland Revenue.

Repayment must be claimed by amendment of the land transaction return made in respect of the contract.

(5) Subject to subsection (6), section 44 (contract and conveyance) does not apply (except so far as it defines “substantial performance”) in relation to the contract.

(6) Where—

(a) this section applies by virtue of subsection (1)(b), and

(b) by reason of B’s direction or request, A becomes obliged to convey a chargeable interest to B,

section 44 applies to that obligation as it applies to a contract for a land transaction that is to be completed by a conveyance.

(7) Section 44 applies in relation to any contract between B and C, in respect of the chargeable interest referred to in subsection (1) above, that is to be completed by a conveyance.

References to completion in that section, as it so applies, include references to conveyance by A to C of the subject matter of the contract between B and C.

(8) In this section “contract” includes any agreement and “conveyance” includes any instrument.

45A

(1) This section applies where—

(a) a contract (“the original contract”) is entered into under which a chargeable interest is to be conveyed by one party to the contract (A) at the direction or request of the other (B)—

(i) to a person (C) who is not a party to the contract, or

(ii) either to such a person or to B,

and

(b) there is an assignment or other transaction (relating to the whole or part of the subject-matter of the original contract) as a result of which a person (D) becomes entitled to exercise any of B’s rights under the original contract in place of B.

References in the following provisions of this section to a transfer of rights are to any such assignment or other transaction.

(2) D is not regarded as entering into a land transaction by reason of the transfer of rights, but section 44A (contract providing for conveyance to third party) has effect in accordance with the following provisions of this section.

(3) That section applies as if—

(a) D had entered into a contract (a “secondary contract”) in the same terms as the original contract except with D as a party instead of B, and

(b) the consideration due from D under the secondary contract were—

(i) so much of the consideration under the original contract as is referable to the subject-matter of the transfer of rights and is to be given (directly or indirectly) by D or a person connected with him, and

(ii) the consideration given for the transfer of rights.

(4) The substantial performance of the original contract shall be disregarded if—

(a) it occurs at the same time as, and in connection with, the substantial performance of the secondary contract, or

(b) it occurs after the transfer of rights.

(5) Where there are successive transfers of rights, subsection (3) has effect in relation to each of them.

(6) The substantial performance of the secondary contract arising from an earlier transfer of rights shall be disregarded if—

(a) it occurs at the same time as, and in connection with, the substantial performance of the secondary contract arising from a subsequent transfer of rights, or

(b) it occurs after that subsequent transfer.

(7) Where a transfer of rights relates to only part of the subject matter of the original contract, or to only some of the rights under that contract—

(a) a reference in subsection (3)(a) or (4) to the original contract, or a reference in subsection (6) to the secondary contract arising from an earlier transfer, is to that contract so far as relating to that part or those rights, and

(b) that contract so far as not relating to that part or those rights shall be treated as a separate contract.

(8) The effective date of a land transaction treated as entered into by virtue of subsection (3) is not earlier than the date of the transfer of rights.

(9) In relation to a such a transaction—

(a) references in Schedule 7 (group relief) to the vendor shall be read as references to A;

(b) other references in this Part to the vendor shall be read, where the context permits, as referring to either A or B.

(10) Section 1122 of the Corporation Tax Act 2010 (connected persons) applies for the purposes of subsection (3)(b).

(11) In this section “contract” includes any agreement.

Initial transfer of assets to trustees of unit trust scheme

Amount of tax chargeable: higher rate for certain transactions

Alternative property finance: land sold to financial institution and leased to person

82A

Schedule 11A has effect with respect to claims not included in returns.

Alternative property finance in Scotland: land sold to financial institution and leased to person

Liability for tax

Payment of tax

Interest on penalties

Orders and regulations made by the Treasury or the Inland Revenue

Interest on repayment of tax overpaid etc

Meaning of “effective date” of a transaction

Consequential amendments

Commencement and transitional provisions

Charge and rates for 2003-04

Restriction of deductions for employee benefit contributions

PAYE: regulations and notional payments

Payroll giving: extension of 10% supplement to 5th April 2004

Sub-contractor deductions etc: interest on late payment or repayment

PAYE: regulations and notional payments

Payroll giving: extension of 10% supplement to 5th April 2004

Extension of first-year allowances for ICT expenditure by small enterprises

Overseas life insurance companies

Relevant discounted securities: withdrawal of relief for costs and losses, etc

Authorised unit trusts, OEICs and common investment funds

Deemed supplies

Gifts with reservation

Repos etc

Authorised unit trusts, OEICs and common investment funds

Foster carers

Higher rate of tax: divided companies

Companies in administration

Companies acquiring their own shares

Gifts with reservation

Exemption for fuel used in recycling processes

Mandatory electronic payment

CHP exemption to be based on current efficiency

Supplies not known to be taxable when made, etc

Acquisition by property trader from individual acquiring new dwelling

Acquisition by property trader from individual where chain of transactions breaks down

Payments in error from or to National Loans Fund

Transfer of chargeable interest to a partnership: general

Introduction

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