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Finance Bill
Part 4 — Stamp duty land tax

    38

 

 56    Amount of tax chargeable: rent

Schedule 5 provides for the calculation of the tax chargeable where the

chargeable consideration for a transaction consists of or includes rent.

Reliefs

 57    Disadvantaged areas relief

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     (1)    Schedule 6 provides for relief in the case of transactions relating to land in a

disadvantaged area.

     (2)    In that Schedule—

                    Part 1 defines “disadvantaged area”,

                    Part 2 relates to transactions where the land to which the transaction

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relates is wholly situated in a disadvantaged area,

                    Part 3 relates to transactions where the land to which the transaction

relates is partly situated in a disadvantaged area, and

                    Part 4 contains supplementary provisions.

 58    Relief for certain exchanges of residential property

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     (1)    Where a dwelling (“the old dwelling”) is acquired from an individual (whether

alone or with other individuals) by a house-building company or a company

connected with a house-building company, the chargeable consideration for

the acquisition is taken to be nil if—

           (a)           the individual (whether alone or with other individuals) acquires from

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the house-building company a new dwelling,

           (b)           the individual—

                  (i)                 occupied the old dwelling as his only or main residence

immediately before its acquisition, and

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

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residence,

           (c)           each acquisition is entered into in consideration of the other, and

           (d)           the area of land acquired by the house-building company or the

connected company does not exceed the permitted area.

     (2)    Where the conditions in subsection (1)(a) to (c) are met but the area of land

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acquired by the house-building company or the connected 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.

     (3)    “Dwelling” includes land occupied and enjoyed with the dwelling as its garden

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or grounds.

     (4)    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

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occupied since its adaptation.

     (5)    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.

 

 

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            Section 839 of the Taxes Act 1988 (connected persons) applies for the purpose

of determining whether a company is connected with a house-building

company.

     (6)    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—

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           (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.

     (7)    Where subsection (6)(b) applies, the permitted area is taken to consist of that

part of the old dwelling that would be the most suitable for occupation and

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enjoyment with the dwelling as its garden or grounds if the rest of the land

were separately occupied.

     (8)    In this section—

           (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;

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           (b)           references to the acquisition of the old dwelling are to the acquisition,

by way of transfer, of a major interest in the dwelling;

           (c)           references to the market value of a dwelling, or of an area of land, are

to the market value of the major interest in the dwelling, or of that

interest so far as it relates to the area in question.

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 59    Relocation relief

     (1)    Where a dwelling is acquired from an employee (whether alone or with other

individuals) by the employer or a relocation company, the acquisition is

exempt from charge if—

           (a)           the individual occupied the dwelling as his only or main residence at

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some time in the period of one year ending with the date of the

acquisition,

           (b)           the acquisition is made in connection with a change of residence by the

individual resulting from relocation of employment,

           (c)           the consideration for the acquisition does not exceed the market value

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of the dwelling, and

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

     (2)    Where the conditions in subsection (1)(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

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of the permitted area from the market value of the dwelling.

     (3)    “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

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           (c)           an alteration of the place where he normally performs those duties.

     (4)    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

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           (b)           the individual’s former residence is not within a reasonable daily

travelling distance of that place.

 

 

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            The employee’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.

     (5)    “Relocation company” means—

           (a)           a company carrying on a business consisting of or including provision

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of the service of acquiring dwellings in connection with a change of

residence resulting from relocation of employment, or

           (b)           a company connected with such a company.

            Section 839 of the Taxes Act 1988 (connected persons) applies for the purposes

of paragraph (b).

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     (6)    “Dwelling” includes land occupied and enjoyed with the dwelling as its garden

or grounds.

     (7)    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

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           (b)           such larger area as is required for the reasonable enjoyment of the

dwelling as a dwelling having regard to its size and character.

     (8)    Where subsection (7)(b) applies, the permitted area is taken to consist of that

part of the dwelling that would be the most suitable for occupation and

enjoyment with the dwelling as its garden or grounds if the rest of the land

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were separately occupied.

     (9)    In this section—

           (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, or of an area of land, are

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to the market value of the major interest in the dwelling, or of that

interest so far as it relates to the area in question;

           (c)           references to an employee include a prospective employee (and

references to the employer are to be construed accordingly).

 60    Compulsory purchase facilitating development

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     (1)    A compulsory purchase facilitating development is exempt from charge.

     (2)    In this section “compulsory purchase facilitating development” means—

           (a)           in relation to England and Wales or Scotland, the acquisition by a

person of a chargeable interest in respect of which that person has made

a compulsory purchase order for the purpose of facilitating

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development by another person;

           (b)           in relation to Northern Ireland, the acquisition by a person of a

chargeable interest by means of a vesting order made for the purpose

of facilitating development by a person other than the person who

acquires the interest.

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     (3)    For the purposes of subsection (2)(a) it does not matter how the acquisition is

effected (so that provision applies where the acquisition is effected by

agreement).

     (4)    In subsection (2)(b) a “vesting order” means an order made under any

statutory provision to authorise the acquisition of land otherwise than by

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agreement.

 

 

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Part 4 — Stamp duty land tax

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     (5)    In this section “development”—

           (a)           in relation to England and Wales, has the same meaning as in the Town

and Country Planning Act 1990 (c. 8) (see section 55 of that Act);

           (b)           in relation to Scotland, has the same meaning as in the Town and

Country Planning (Scotland) Act 1997 (c. 8) (see section 26 of that Act);

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and

           (c)           in relation to Northern Ireland, has the same meaning as in the

Planning (Northern Ireland) Order 1991 (1991/1220 (N.I. 11)) (see

Article 11 of that Order).

 61    Compliance with planning obligations

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     (1)    A land transaction that is entered into in order to comply with a planning

obligation or a modification of a planning obligation is exempt from charge if—

           (a)           the planning obligation or modification is enforceable against the

vendor,

           (b)           the purchaser is a public authority, and

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           (c)           the transaction takes place within the period of five years beginning

with the date on which the planning obligation was entered into or

modified.

     (2)    In this section—

           (a)           in relation to England and Wales—

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                                  “planning obligation” means either of the following—

                        (a)                        a planning obligation within the meaning of section 106

of the Town and Country Planning Act 1990 that is

entered into in accordance with subsection (9) of that

section, or

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                        (b)                        a planning obligation within the meaning of section

299A of that Act that is entered into in accordance with

subsection (2) of that section; and

                                  “modification” of a planning obligation means modification as

mentioned in section 106A(1) of that Act;

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           (b)           in relation to Scotland, “planning obligation” means an agreement

made under section 75 or section 246 of the Town and Country

Planning (Scotland) Act 1997;

           (c)           in relation to Northern Ireland—

                                  “planning obligation” means a planning agreement within the

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meaning of Article 40 of the Planning (Northern Ireland) Order

1991 (1991/1220 (N.I. 11)) that is entered into accordance with

paragraph (10) of that Article, and

                                  “modification” of a planning obligation means modification as

mentioned in Article 40A(1) of that Order.

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     (3)    The following are public authorities for the purposes of subsection (1)(b)—

Government

            A Minister of the Crown or government department

            The Scottish Ministers

            A Northern Ireland department

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            The National Assembly for Wales

            

            

 

 

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Local government: England

            A county or district council constituted under section 2 of the Local

Government Act 1972 (c. 70)

            The council of a London borough

            The Common Council of the City of London

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            The Greater London Authority

            Transport for London

            The Council of the Isles of Scilly

            Local government: Wales

            A county or county borough council constituted under section 21 of the Local

10

Government Act 1972

Local government: Scotland

            A council constituted under section 2 of the Local Government etc. (Scotland)

Act 1994 (c. 39)

Local government: Northern Ireland

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            A district council within the meaning of the Local Government Act (Northern

Ireland) 1972 (c. 9 (N.I.))

Health: England and Wales

            A Strategic Health Authority or Health Authority established under section 8

of the National Health Service Act 1977 (c. 49)

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            A Special Health Authority established under section 11 of that Act

            A Primary Care Trust established under section 16A of that Act

            A Local Health Board established under section 16BA of that Act

            A National Health Service Trust established under section 5 of the National

Health Service and Community Care Act 1990 (c. 19)

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Health: Scotland

            The Common Services Agency established under section 10(1) of the National

Health Service (Scotland) Act 1978 (c. 29)

            A Health Board established under section 2(1)(a) of that Act

            A National Health Service Trust established under section 12A(1) of that Act

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            A Special Health Board established under section 2(1)(b) of that Act

Health: Northern Ireland

            A Health and Social Services Board established under Article 16 of the Health

and Personal Social Services (Northern Ireland) Order 1972 (S.I. 1972/1265

(N.I. 14))

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            A Health and Social Services Trust established under Article 10 of the Health

and Personal Social Services (Northern Ireland) Order 1991 (S.I. 1991/194

(N.I. 1))

            Other planning authorities

            Any other authority that—

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           (a)           is a local planning authority within the meaning of the Town and

Country Planning Act 1990 (c. 8), or

           (b)           is the planning authority for any of the purposes of the planning Acts

within the meaning of the Town and Country Planning (Scotland) Act

1997 (c. 8).

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            Prescribed persons

            A person prescribed for the purposes of this section by Treasury order

 

 

 
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