|
| |
|
107 | Interests held by connected persons |
| |
(1) | If on any day a company (“C”) is entitled to a single-dwelling interest in a |
| |
dwelling and another person (“P”) who is connected with C is entitled to a |
| |
different single-dwelling interest in the same dwelling, this Part has effect— |
| |
(a) | in relation to C as if C were on that day entitled to P’s single-dwelling |
| 5 |
interest as well as C’s single-dwelling interest, and |
| |
(b) | (if P is a company) in relation to P as if P were on that day entitled to |
| |
C’s single-dwelling interest as well as P’s single-dwelling interest. |
| |
(2) | If on any day a single-dwelling interest (“the scheme interest”) is held for the |
| |
purposes of a collective investment scheme and a person (“P”) who is |
| 10 |
connected with the scheme is entitled to a different single-dwelling interest in |
| |
the same dwelling, this Part has effect— |
| |
(a) | in relation to the scheme, as if both those separate interests were on that |
| |
day held for the purposes of the scheme, and |
| |
(b) | (if P is a company) in relation to P as if P were (on that day) entitled to |
| 15 |
the scheme interest as well as P’s single-dwelling interest. |
| |
(3) | If on any day a single-dwelling interest in a dwelling is held for the purposes |
| |
of a collective investment scheme (“the first scheme”) and another interest in |
| |
the same dwelling is held for the purposes of another collective investment |
| |
scheme (“the second scheme”) that is connected with the first scheme, this Part |
| 20 |
| |
(a) | in relation to the first scheme, as if both the interests were held on that |
| |
day for the purposes of that scheme, and |
| |
(b) | in relation to the second scheme, as if both interests were held on that |
| |
day for the purposes of that scheme. |
| 25 |
| |
(a) | section 94, for provision about the liability to tax of persons treated |
| |
under this section (read with section 101) as jointly entitled to a single- |
| |
| |
(b) | paragraph 55 of Schedule 31, for provision about returns in cases |
| 30 |
involving joint entitlement. |
| |
(5) | The provisions mentioned in subsection (4) are to be read as including |
| |
corresponding provision for cases where the same single-dwelling interest is |
| |
treated under this section as held— |
| |
(a) | for the purposes of different collective investment schemes, or |
| 35 |
(b) | by a company and for the purposes of a collective investment scheme. |
| |
108 | Section 107: superior and inferior interests |
| |
Where a company and an individual connected with the company are on any |
| |
day entitled to single-dwelling interests in the same dwelling, section 107(1) |
| |
| 40 |
(a) | the company’s interest is a freehold or leasehold interest the taxable |
| |
value of which is £500,000 or less, and |
| |
(b) | the individual’s interest is a leasehold interest that is inferior to the |
| |
| |
|
| |
|
| |
|
109 | Different interests held in the same dwelling: effect of reliefs etc |
| |
(1) | References in section 107 to a person do not include— |
| |
(a) | a public body, as defined in section 151, |
| |
(b) | a body listed in section 152(2) (bodies established for national |
| |
| 5 |
(2) | Subsections (1) to (3) of section 107 do not apply in relation to a single-dwelling |
| |
interest if the day in question is relievable with respect to that interest by virtue |
| |
| |
(a) | section 148 (charitable companies), |
| |
(b) | section 150 (providers of social housing), or |
| 10 |
(c) | section 153 (dwelling conditionally exempt from inheritance tax). |
| |
(3) | Subsection (4) applies where the separate interests (the “relevant interests”) |
| |
that under section 107 (or that section and section 106) are treated as |
| |
constituting, on a day, just one single-dwelling interest (“the combined |
| |
| 15 |
(a) | a freehold or leasehold interest, and |
| |
(b) | a leasehold interest (“the inferior interest”) granted out of that interest. |
| |
(4) | If the inferior interest is the most inferior relevant interest, the combined |
| |
interest, and the dwelling itself (where relevant), are regarded for the purposes |
| |
of the relevant relieving provisions as being exploited, on the day mentioned |
| 20 |
in subsection (3), in the way the inferior interest is exploited on that day. |
| |
(5) | If the inferior interest is an interest in part only (“the sub-let part”) of the land |
| |
that is the subject-matter of the combined interest, subsection (4) has effect in |
| |
relation to the combined interest only so far as that interest relates to the sub- |
| |
| 25 |
(6) | In this section “the relevant relieving provisions” means sections 130 to 150. |
| |
(7) | The inferior interest counts as “the most inferior relevant interest” if no |
| |
relevant interest (see subsection (3)) is a leasehold interest granted out of it. |
| |
(8) | In this section the reference to a leasehold interest includes the interest of a |
| |
lessee under an agreement for a lease. |
| 30 |
(9) | In the application of this section to Scotland— |
| |
(a) | the reference to a freehold interest is to the interest of the owner; |
| |
(b) | the reference to a leasehold interest is to a tenant’s right over or interest |
| |
in property subject to a lease; |
| |
(c) | the reference to an agreement for lease includes missives of let. |
| 35 |
| |
110 | Meaning of “dwelling” |
| |
(1) | A building or part of a building counts as a dwelling at any time when— |
| |
(a) | it is used or suitable for use as a single dwelling, or |
| |
(b) | it is in the process of being constructed or adapted for such use. |
| 40 |
(2) | Land that is, or is at any time intended to be, occupied or enjoyed with a |
| |
dwelling as a garden or grounds (including any building or structure on such |
| |
land) is taken to be part of that dwelling at that time. |
| |
|
| |
|
| |
|
(3) | Land that subsists, or is at any time intended to subsist, for the benefit of a |
| |
dwelling is taken to be part of the dwelling at that time. |
| |
(4) | A building, or part of a building, used for a purpose specified in section 116(2) |
| |
or (3) of FA 2003 is not used as a dwelling for the purposes of subsection (1). |
| |
(5) | Where a building, or part of a building, is used for a purpose mentioned in |
| 5 |
subsection (4), no account is to be taken for the purposes of subsection (1) of its |
| |
suitability for any other use. |
| |
(6) | If a building or part of a building becomes temporarily unsuitable for use as a |
| |
dwelling for any reason (including accidental damage, repairs or any other |
| |
physical change to the building or its environment), that temporary |
| 10 |
unsuitability is ignored in determining whether or not the building or part of |
| |
a building is, during the period in question, a dwelling for the purposes of this |
| |
| |
| This subsection does not affect any of the provisions in sections 124 to 129. |
| |
111 | Substantial performance of “off plan” purchase |
| 15 |
(1) | Subsection (2) applies where— |
| |
(a) | a contract is entered into for the acquisition of a chargeable interest in |
| |
or over land that consists of or includes a building, or part of a building, |
| |
that is to be constructed or adapted for use as a single dwelling, |
| |
(b) | substantial performance is treated as constituting the acquisition of the |
| 20 |
chargeable interest (under section 120), and |
| |
(c) | construction or adaptation of the building, or the part of a building, has |
| |
not begun by the time the contract is substantially performed. |
| |
(2) | The chargeable interest deemed to be acquired as mentioned in subsection |
| |
(1)(b) is taken to be in or over land that consists of or (as appropriate) includes |
| 25 |
| |
(3) | If at any time after the substantial performance of the contract the obligation |
| |
under the contract to carry out the construction or adaptation ceases to have |
| |
effect without the construction or adaptation having been begun, subsection |
| |
(2) ceases to apply at that time. |
| 30 |
(4) | A building or part of a building used for a purpose specified in section 116(2) |
| |
or (3) of FA 2003 is not used as a dwelling for the purposes of subsection (1). |
| |
| |
“contract” includes any agreement (including, in the case of Scotland, |
| |
missives of let not constituting a lease); |
| 35 |
“substantially performed” has the same meaning as in section 44 of FA |
| |
| |
112 | Power to modify meaning of “use as a dwelling” |
| |
(1) | The Treasury may by order amend this Part so as to specify cases where use of |
| |
a building is to be use of a building as a dwelling for the purposes of section |
| 40 |
| |
(2) | The reference in section 116(8)(a) of FA 2003 (power to amend section 116(2) |
| |
and (3)) to “the purposes of subsection (1)” includes a reference to the purposes |
| |
of sections 110(1) and 111(1). |
| |
|
| |
|
| |
|
113 | Parts of a greater whole |
| |
(1) | The fact that a part of a building is suitable for use as a dwelling does not |
| |
prevent that part from forming part of a larger single dwelling. |
| |
(2) | The fact that a building or structure that is— |
| |
(a) | in the garden or grounds of a dwelling, and |
| 5 |
(b) | occupied or enjoyed with the dwelling, |
| |
| is itself suitable for use as a single dwelling does not prevent it from being |
| |
treated (in accordance with section 110(2)) as part of the dwelling. |
| |
114 | Dwelling in grounds of another dwelling |
| |
(1) | Subsection (4) applies where the conditions in subsection (2) are met in relation |
| 10 |
to two dwellings (the “main dwelling” and the “associated dwelling”) on a day |
| |
(“the day in question”) in a chargeable period. |
| |
(2) | The conditions are that— |
| |
(a) | the main dwelling has a garden or grounds, |
| |
(b) | the associated dwelling stands within the garden or grounds of the |
| 15 |
main dwelling, but is not occupied or enjoyed with that dwelling, |
| |
(c) | the associated dwelling does not have separate access, and is not part |
| |
of the same building as the main dwelling, and |
| |
(d) | the common ownership condition is met. |
| |
(3) | The common ownership condition is that— |
| 20 |
(a) | a company is entitled to a chargeable interest in the main dwelling, and |
| |
the company or a person connected with the company is entitled to a |
| |
chargeable interest in the associated dwelling, or |
| |
(b) | a chargeable interest in the main dwelling is held for the purposes of a |
| |
collective investment scheme, and a chargeable interest in the |
| 25 |
associated dwelling is held for the purposes of the same collective |
| |
| |
| (It does not matter whether or not the interest in the main dwelling and the |
| |
interest in the associated dwelling are held for the same title.) |
| |
(4) | This Part has effect in relation to the interests mentioned in paragraph (a) or (as |
| 30 |
the case may be) (b) of subsection (3) as if the main dwelling and the associated |
| |
dwelling were, on the day in question, suitable for use as a single dwelling. |
| |
(5) | Subsection (4) does not apply if the day in question is, in relation to the interest |
| |
in the main dwelling or the interest in the associated dwelling, relievable by |
| |
virtue of a provision mentioned in subsection (6). |
| 35 |
(6) | Those provisions are— |
| |
section 131 (property rental businesses); |
| |
section 132 (rental property: preparation for sale etc); |
| |
section 135 (dwellings opened to the public); |
| |
section 136 (property developers); |
| 40 |
section 137 (property developers: exchange of dwellings); |
| |
section 139 (property traders); |
| |
section 141 (financial institutions acquiring dwellings in the course of |
| |
| |
section 143 (occupation by certain employees or partners); |
| 45 |
|
| |
|
| |
|
section 146 (farmhouses); |
| |
section 148 (charitable companies); |
| |
section 150 (providers of social housing). |
| |
(7) | The reference in subsection (3)(a) to a person connected with the company does |
| |
not include a public body (as defined in section 151) or a body listed in section |
| 5 |
152(2) (bodies established for national purposes). |
| |
(8) | The reference in subsection (3)(b) to a chargeable interest being held for the |
| |
purposes of the same collective investment scheme includes a reference to a |
| |
person connected with the scheme being entitled to the interest. |
| |
(9) | The associated dwelling has “separate access” only if— |
| 10 |
(a) | there is access to the associated dwelling directly from a highway (in |
| |
Scotland, a road) that the dwelling adjoins, or |
| |
(b) | the person entitled to possession of the associated dwelling has access |
| |
to that dwelling from a highway (in Scotland, a road), exclusively by |
| |
passing over land that the person is entitled to pass over by reason of |
| 15 |
one or more rights of way or other interests in land to which the person |
| |
| |
| |
in relation to a dwelling or dwellings, references to the “garden or |
| |
grounds” are to land occupied or enjoyed with the dwelling or |
| 20 |
dwellings as a garden or grounds; |
| |
references to the person entitled to possession of a dwelling are to the |
| |
person entitled to possession of the dwelling by reason of an estate or |
| |
interest held by that person; |
| |
“separately entitled” means entitled otherwise than by reason of a |
| 25 |
chargeable interest in or over the main dwelling. |
| |
115 | Dwellings in the same building |
| |
(1) | Two parts of a building are “linked dwellings” if— |
| |
(a) | each of them counts as a dwelling, |
| |
(b) | there is private access between the two dwellings, |
| 30 |
(c) | the two parts of the building are not (together) used or suitable for use |
| |
as a single dwelling, and |
| |
(d) | the common ownership condition and the use condition are met. |
| |
(2) | The common ownership condition is that— |
| |
(a) | a company is entitled to a chargeable interest in one of the dwellings, |
| 35 |
and the company or a person connected with the company is entitled to |
| |
a chargeable interest in the other dwelling, or |
| |
(b) | a chargeable interest in one of the dwellings is held for the purposes of |
| |
a collective investment scheme, and a chargeable interest in the other |
| |
dwelling is held for the purposes of the same collective investment |
| 40 |
| |
| (It does not matter whether or not the interests are held for the same title.) |
| |
(3) | If on a day in a chargeable period (“the day in question”) two parts of a |
| |
building constitute linked dwellings, this Part has effect in relation to the |
| |
interests mentioned in paragraph (a) or (as the case may be) (b) of subsection |
| 45 |
(2) as if the two parts were, on the day in question, suitable for use as a single |
| |
| |
|
| |
|
| |
|
(4) | Subsection (3) does not apply if the day in question is, in relation to a |
| |
chargeable interest mentioned in subsection (2)(a) or (as the case may be) (2)(b), |
| |
relievable by virtue of a provision mentioned in subsection (5). |
| |
(5) | Those provisions are— |
| |
section 131 (property rental businesses); |
| 5 |
section 132 (rental property: preparation for sale etc); |
| |
section 135 (dwellings opened to the public); |
| |
section 136 (property developers); |
| |
section 137 (property developers: exchange of dwellings); |
| |
section 139 (property traders); |
| 10 |
section 141 (financial institutions acquiring dwellings in the course of |
| |
| |
section 143 (occupation by certain employees or partners); |
| |
section 146 (farmhouses); |
| |
section 148 (charitable companies); |
| 15 |
section 150 (providers of social housing). |
| |
(6) | The reference in subsection (2)(a) to a person connected with the company does |
| |
not include a public body (as defined in section 151) or a body listed in section |
| |
152(2) (bodies established for national purposes). |
| |
(7) | If two dwellings in a building (dwelling A and dwelling B) are treated under |
| 20 |
this section as suitable for use as a single dwelling, and dwelling B and a third |
| |
dwelling in the building (“dwelling C”) are treated under this section as |
| |
suitable for use as a single dwelling, all three are treated as suitable for use as |
| |
a single dwelling (and so on). |
| |
116 | Section 115: supplementary |
| 25 |
(1) | The reference in section 115(2)(b) to a chargeable interest being held for the |
| |
purposes of the same collective investment scheme includes a reference to a |
| |
person connected with the scheme being entitled to the interest. |
| |
(2) | For the purposes of section 115, there is private access between two dwellings |
| |
if the person entitled to possession of each dwelling is entitled, by reason of a |
| 30 |
right of way or other interest in land, to have access to that person’s dwelling |
| |
from the other dwelling, without passing over any part of the building (or any |
| |
other land) in which a third party has an interest entitling that third party to |
| |
| |
(3) | In subsection (2) “third party” means a person other than— |
| 35 |
(a) | the persons entitled to possession of the dwellings mentioned in |
| |
| |
(b) | persons connected with any of them. |
| |
(4) | The use condition mentioned in section 115(1)(d) is that each of the two |
| |
| 40 |
(a) | is occupied (or usually occupied) by a relevant individual, |
| |
(b) | is intended to be so occupied (or usually so occupied), or |
| |
| |
(5) | In subsection (4) “relevant individual” means— |
| |
|
| |
|
| |
|
(a) | an individual connected with the company mentioned in section |
| |
| |
(b) | an individual connected with the collective investment scheme |
| |
mentioned in section 115(2)(b), |
| |
(c) | an individual who occupies (or is to occupy) the dwelling concerned |
| 5 |
otherwise than on commercial terms, or |
| |
(d) | an individual who is employed wholly or partly in connection with the |
| |
occupation by a person falling within any of paragraphs (a) to (c) of a |
| |
dwelling in the building, or provides services in connection with such |
| |
a person’s occupation of a dwelling in the building. |
| 10 |
(6) | In this section references to the person entitled to possession of a dwelling are |
| |
to the person entitled to possession of the dwelling by reason of an estate or |
| |
interest held by that person. |
| |
| |
Any structure (such as a terrace of houses or a pair of semi-detached houses) |
| 15 |
that is composed of or includes dwellings is regarded as a building for the |
| |
purposes of sections 115 and 116. |
| |
Acquisitions and disposals |
| |
118 | Acquisitions and disposals of chargeable interests |
| |
(1) | References in this Part to the acquisition of a chargeable interest include any |
| 20 |
acquisition however effected (including an acquisition effected by the act of |
| |
parties to a transaction, by order of a court or other authority, by or under any |
| |
statutory provision or by operation of law). |
| |
(2) | The surrender or release of a chargeable interest is— |
| |
(a) | an acquisition of that interest by any person whose interest or right is |
| 25 |
benefited or enlarged by the transaction, and |
| |
(b) | a disposal by the person ceasing to be entitled to that interest. |
| |
(3) | The variation of a chargeable interest is— |
| |
(a) | an acquisition of a chargeable interest by the person benefiting from the |
| |
| 30 |
(b) | a disposal of a chargeable interest by the person whose interest is |
| |
subject to or limited by the variation. |
| |
119 | Date of acquisition or disposal |
| |
(1) | A person who acquires a chargeable interest in or over land that consists of or |
| |
includes a dwelling is treated for the purposes of this Part as acquiring the |
| 35 |
interest on the effective date of the acquisition (and therefore as entitled to the |
| |
interest with effect from that date: see section 169). |
| |
(2) | A person who disposes of a chargeable interest in or over land that consists of |
| |
or includes a dwelling is treated for the purposes of this Part as ceasing to be |
| |
entitled to the interest on the effective date of the disposal (and therefore as not |
| 40 |
being entitled to the interest on that day: see section 169). |
| |
(3) | If a person’s acquisition and disposal of a chargeable interest are completed on |
| |
the same day, then for the purposes of this Part— |
| |
|
| |
|