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Finance Bill


Finance Bill
Part 4 — Stamp duty land tax

    34

 

     (4)    In the application of this Part in Scotland the reference in subsection (3)(a) to a

rentcharge shall be read as a reference to a feu duty or a payment mentioned

in section 56(1) of the Abolition of Feudal Tenure etc. (Scotland) Act 2000

(asp 5).

     (5)    The Treasury may by regulations provide that any other description of interest

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or right in relation to land in the United Kingdom is an exempt interest.

     (6)    The regulations may contain such supplementary, incidental and transitional

provision as appears to the Treasury to be appropriate.

 49    Chargeable transactions

     (1)    A land transaction is a chargeable transaction if it is not a transaction that is

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exempt from charge.

     (2)    Schedule 3 provides for certain transactions to be exempt from charge.

            Other transactions are exempt from charge under other provisions of this Part.

 50    Chargeable consideration

     (1)    Schedule 4 makes provision as to the chargeable consideration for a

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transaction.

     (2)    The Treasury may by regulations amend or repeal the provisions of this Part

relating to chargeable consideration and make such other provision as appears

to them appropriate with respect to—

           (a)           what is to count as chargeable consideration, or

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           (b)           the determination of the amount of chargeable consideration.

     (3)    The regulations may make different provision in relation to different

descriptions of transaction or consideration and different circumstances.

 51    Contingent, uncertain or unascertained consideration

     (1)    Where the whole or part of the chargeable consideration for a transaction is

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contingent, the amount or value of the consideration shall be determined for

the purposes of this Part on the assumption that the outcome of the

contingency will be such that the consideration is payable or, as the case may

be, does not cease to be payable.

     (2)    Where the whole or part of the chargeable consideration for a transaction is

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uncertain or unascertained, its amount or value shall be determined for the

purposes of this Part on the basis of a reasonable estimate.

     (3)    In this Part—

                    “contingent”, in relation to consideration, means—

                  (a)                 that it is to be paid or provided only if some uncertain future

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event occurs, or

                  (b)                 that it is to cease to be paid or provided if some uncertain future

event occurs; and

                    “uncertain”, in relation to consideration, means that its amount or value

depends on uncertain future events.

40

     (4)    This section has effect subject to—

 

 

Finance Bill
Part 4 — Stamp duty land tax

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                    section 80 (adjustment where contingency ceases or consideration is

ascertained), and

                    section 90 (application to defer payment in case of contingent or uncertain

consideration).

 52    Annuities etc: chargeable consideration limited to twelve years’ payments

5

     (1)    This section applies to so much of the chargeable consideration for a land

transaction as consists of an annuity payable—

           (a)           for life, or

           (b)           in perpetuity, or

           (c)           for an indefinite period, or

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           (d)           for a definite period exceeding twelve years.

     (2)    For the purposes of this Part the consideration to be taken into account is

limited to twelve years’ annual payments.

     (3)    Where the amount payable varies, or may vary, from year to year, the twelve

highest annual payments shall be taken.

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            No account shall be taken for the purposes of this Schedule of any provision for

adjustment of the amount payable in line with the retail price index.

     (4)    References in this section to annual payments are to payments in respect of

each successive period of twelve months beginning with the effective date of

the transaction.

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     (5)    For the purposes of this section the amount or value of any payment shall be

determined (if necessary) in accordance with section 51 (contingent, uncertain

or unascertained consideration).

     (6)    References in this section to an annuity include any consideration (other than

rent) that falls to be paid or provided periodically.

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            References to payment shall be read accordingly.

     (7)    Where this section applies—

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

ascertained) does not apply, and

           (b)           no application may be made under section 90 (application to defer

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payment in case of contingent or uncertain consideration).

 53    Deemed market value where transaction involves connected company

     (1)    Where the purchaser is a company and—

           (a)           the vendor is connected with the purchaser, or

           (b)           some or all of the consideration for the transaction consists of the issue

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or transfer of shares in a company with which the vendor is connected,

            the chargeable consideration for the transaction shall be taken to be not less

than the market value of the subject matter of the transaction as at the effective

date of the transaction.

     (2)    Section 839 of the Taxes Act 1988 (connected persons) has effect for the

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purposes of this section.

     (3)    In this section—

                    “company” means any body corporate;

 

 

Finance Bill
Part 4 — Stamp duty land tax

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                    “shares” includes stock and the reference to shares in a company includes

a reference to securities issued by a company.

     (4)    Where this section applies paragraph 1 of Schedule 3 (exemption of

transactions for which there is no chargeable consideration) does not apply.

            But this section has effect subject to any other provision affording exemption

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or relief from stamp duty land tax.

     (5)    This section is subject to the exceptions provided for in section 54.

 54    Exceptions from deemed market value rule

     (1)    Section 53 (chargeable consideration: transaction with connected company)

does not apply in the following cases.

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            In the following provisions “the company” means the company that is the

purchaser in relation to the transaction in question.

     (2)    Case 1 is where immediately after the transaction the company holds the

property as trustee in the course of a business carried on by it that consists of

or includes the management of trusts.

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     (3)    Case 2 is where—

           (a)           immediately after the transaction the company holds the property as

trustee, and

           (b)           the vendor is connected with the company only because of section

839(3) of the Taxes Act 1988.

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     (4)    Case 3 is where—

           (a)           the vendor is a company and the transaction is, or is part of, a

distribution of the assets of that company (whether or not in connection

with its winding up), and

           (b)           it is not the case that—

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                  (i)                 the subject-matter of the transaction, or

                  (ii)                an interest from which that interest is derived,

                         has, within the period of three years immediately preceding the

effective date of the transaction, been the subject of a transaction in

respect of which group relief was claimed by the vendor.

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Amount of tax chargeable

 55    Amount of tax chargeable: general

     (1)    The amount of tax chargeable in respect of a chargeable transaction is a

percentage of the chargeable consideration for the transaction.

     (2)    That percentage is determined by reference to whether the relevant land—

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           (a)           consists entirely of residential property (in which case Table A below

applies), or

           (b)           consists of or includes land that is not residential property (in which

case Table B below applies),

            and, in either case, by reference to the amount of the relevant consideration.

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Finance Bill
Part 4 — Stamp duty land tax

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Table A: Residential

 
 

Relevant consideration

Percentage

 
 

Not more than £60,000

0%

 
 

More than £60,000 but not more

1%

 
 

than £250,000

  

5

 

More than £250,000 but not

3%

 
 

more than £500,000

  
 

More than £500,000

4%

 
 

Table B: Non-residential or mixed

 
 

Relevant consideration

Percentage

 

10

 

Not more than £150,000

0%

 
 

More than £150,000 but not

1%

 
 

more than £250,000

  
 

More than £250,000 but not

3%

 
 

more than £500,000

  

15

 

More than £500,000

4%

 

     (3)    For the purposes of subsection (2)—

           (a)           the relevant land is the land an interest in which is the main subject-

matter of the transaction, and

           (b)           the relevant consideration is the chargeable consideration for the

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transaction,

            subject as follows.

     (4)    If the transaction in question is one of a number of linked transactions—

           (a)           the relevant land is any land an interest in which is the main subject-

matter of any of those transactions, and

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           (b)           the relevant consideration is the total of the chargeable consideration

for all those transactions.

     (5)    This section has effect subject to—

                    section 74 (collective enfranchisement by leaseholders), and

                    section 75 (crofting community right to buy),

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            (which provide for the rate of tax to be determined by reference to a fraction of

the relevant consideration).

     (6)    In the case of a transaction for which the whole or part of the chargeable

consideration is rent this section has effect subject to section 56 and Schedule 5

(amount of tax chargeable: rent).

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     (7)    References in this Part to the “rate of tax” are to the percentage determined

under this section.

 

 

 
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Revised 2 July 2003