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(iii) by two or more persons at least one of whom is not the | |
person, or one of the persons, by whom the company was | |
previously controlled. | |
Recovery of reconstruction or acquisition relief from another group company or controlling | |
director | 5 |
12 (1) This paragraph applies where— | |
(a) tax is chargeable under paragraph 9 or 11 (withdrawal of | |
reconstruction or acquisition relief), | |
(b) the amount so chargeable has been finally determined, and | |
(c) the whole or part of the amount so chargeable is unpaid six months | 10 |
after the date on which it became payable. | |
(2) The following persons may, by notice under paragraph 13, be required to | |
pay the unpaid tax— | |
(a) any company that at any relevant time was a member of the same | |
group as the acquiring company and was above it in the group | 15 |
structure; | |
(b) any person who at any relevant time was a controlling director of the | |
acquiring company or a company having control of the acquiring | |
company. | |
(3) For the purposes of sub-paragraph (2) “relevant time” means any time | 20 |
between effective date of the relevant transaction and the change of control | |
by virtue of which tax is chargeable. | |
(4) For the purposes of sub-paragraph (2)(a) a company (“company A”) is | |
“above” another company (“company B”) in a group structure if company B, | |
or another company that is above company B in the group structure, is a 75% | 25 |
subsidiary of company A. | |
(5) For the purposes of sub-paragraph (2)(b)— | |
(a) “director”, in relation to a company, has the meaning given by | |
section 67(1) of the Income Tax (Earnings and Pensions) Act 2003 | |
(c. 1) (read with subsection (2) of that section) and includes any | 30 |
person falling within section 417(5) of the Taxes Act 1988 (read with | |
subsection (6) of that section); and | |
(b) “controlling director”, in relation to a company, means a director of | |
the company who has control of it (construing control in accordance | |
with section 416 of the Taxes Act 1988). | 35 |
Recovery of reconstruction or acquisition relief: supplementary | |
13 (1) The Inland Revenue may serve a notice on a person within paragraph 12(2) | |
above requiring him within 30 days of the service of the notice to pay the | |
amount that remains unpaid. | |
(2) Any such notice must be served before the end of the period of three years | 40 |
beginning with the date of the final determination mentioned in paragraph | |
12(1)(b). | |
(3) The notice must state the amount required to be paid by the person on whom | |
the notice is served. | |
(4) The notice has effect— | 45 |
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(a) for the purposes of the recovery from that person of the amount | |
required to be paid and of interest on that amount, and | |
(b) for the purposes of appeals, | |
as if it were a notice of assessment and that amount were an amount of tax | |
due from that person. | 5 |
(5) A person who has paid an amount in pursuance of a notice under this | |
paragraph may recover that amount from the acquiring company. | |
(6) A payment in pursuance of a notice under this paragraph is not allowed as | |
a deduction in computing any income, profits or losses for any tax purpose. | |
Schedule 8 | 10 |
Section 68 | |
Stamp duty land tax: charities relief | |
Charities relief | |
1 (1) A land transaction is exempt from charge if the purchaser is a charity and the | |
following conditions are met. | |
Relief under this paragraph is referred to in this Part as “charities relief”. | 15 |
(2) The first condition is that the purchaser must intend to hold the subject- | |
matter of the transaction for qualifying charitable purposes, that is— | |
(a) for use in furtherance of the charitable purposes of the purchaser or | |
of another charity, or | |
(b) as an investment from which the profits are applied to the charitable | 20 |
purposes of the purchaser. | |
(3) The second condition is that the transaction must not have not been entered | |
into for the purpose of avoiding tax under this Part (whether by the | |
purchaser or any other person). | |
(4) In this paragraph a “charity” means a body or trust established for charitable | 25 |
purposes only. | |
Withdrawal of charities relief | |
2 (1) Where in the case of a transaction (“the relevant transaction”) that is exempt | |
by virtue of paragraph 1 (charities relief)— | |
(a) a disqualifying event occurs— | 30 |
(i) before the end of the period of three years beginning with the | |
effective date of the transaction, or | |
(ii) in pursuance of, or in connection with, arrangements made | |
before the end of that period, | |
and | 35 |
(b) at the time of the disqualifying event the purchaser holds a | |
chargeable interest— | |
(i) that was acquired by the purchaser under the relevant | |
transaction, or | |
(ii) that is derived from an interest so acquired, | 40 |
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charities relief in relation to the relevant transaction, or an appropriate | |
proportion of it, is withdrawn and tax is chargeable in accordance with this | |
paragraph. | |
(2) The amount chargeable is the amount that would have been chargeable in | |
respect of the relevant transaction but for charities relief or, as the case may | 5 |
be, an appropriate proportion of the tax that would have been so chargeable. | |
(3) For the purposes of this paragraph a “disqualifying event” means— | |
(a) the purchaser ceasing to be established for charitable purposes only, | |
or | |
(b) the subject-matter of the transaction, or any interest or right derived | 10 |
from it, being used or held by the purchaser otherwise than for | |
qualifying charitable purposes. | |
(4) In sub-paragraphs (1) and (2) an “appropriate proportion” means an | |
appropriate proportion having regard to— | |
(a) what was acquired by the purchaser under the relevant transaction | 15 |
and what is held by the purchaser at the time of the disqualifying | |
event, and | |
(b) the extent to which what is held by the purchaser at that time | |
becomes used or held for purposes other than qualifying charitable | |
purposes. | 20 |
(5) In this paragraph “qualifying charitable purposes” has the same meaning as | |
in paragraph 1. | |
Schedule 9 | |
Section 70 | |
Stamp duty land tax: right to buy, shared ownership leases etc | |
Right to buy transactions | 25 |
1 (1) In the case of a right to buy transaction— | |
(a) section 51(1) (contingent consideration to be included in chargeable | |
consideration on assumption that contingency will occur) does not | |
apply, and | |
(b) any consideration that would be payable only if a contingency were | 30 |
to occur, or that is payable only because a contingency has occurred, | |
does not count as chargeable consideration. | |
(2) A “right to buy transaction” means— | |
(a) the sale of a dwelling at a discount, or the grant of a lease of a | |
dwelling at a discount, by a relevant public sector body, or | 35 |
(b) the sale of a dwelling, or the grant of a lease of a dwelling, in | |
pursuance of the preserved right to buy. | |
(3) The following are relevant public sector bodies for the purposes of sub- | |
paragraph (2)(a): | |
Government | 40 |
A Minister of the Crown | |
The Scottish Ministers | |
A Northern Ireland department | |
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Local Government | |
A county council | |
A council constituted under section 2 of the Local Government etc. | |
(Scotland) Act 1994 (c. 39), the common good of such a council or any trust | |
under its control | 5 |
A district council within the meaning of the Local Government Act | |
(Northern Ireland) 1972 (c. 9 (N.I.)) | |
The Council of the Isles of Scilly | |
A local housing authority within the meaning of the Housing Act 1985 (c. 68) | |
Social housing | 10 |
The Housing Corporation | |
Scottish Homes | |
The Northern Ireland Housing Executive | |
A registered social landlord | |
A housing action trust established under Part 3 of the Housing Act 1988 | 15 |
(c. 50) | |
New towns and development corporations | |
The Commission for the New Towns | |
A development corporation established by an order made, or having effect | |
as if made, under the New Towns Act 1981 (c. 64) | 20 |
A development corporation established by an order made, or having effect | |
as if made, under the New Towns (Scotland) Act 1968 (c. 16) | |
A new town commission established under section 7 of the New Towns Act | |
(Northern Ireland) 1965 (c. 13 (N.I.)) | |
An urban development corporation established by an order made under | 25 |
section 135 of the Local Government, Planning and Land Act 1980 (c. 65) | |
Police | |
A police authority within the meaning of section 101(1) of the Police Act 1996 | |
(c. 16) | |
A police authority within the meaning of section 2(1) or 19(9)(b) of the Police | 30 |
(Scotland) Act 1967 (c. 77) | |
The Northern Ireland Policing Board | |
Miscellaneous | |
An Education and Libraries Board within the meaning of the Education and | |
Libraries (Northern Ireland) Order 1986 (S.I. 1986/594 (N.I. 3)) | 35 |
The United Kingdom Atomic Energy Authority | |
Any person mentioned in paragraphs (g), (k), (l) or (n) of section 61(11) of | |
the Housing (Scotland) Act 1987 (c. 26) | |
A body prescribed for the purposes of this sub–paragraph by Treasury | |
order. | 40 |
(4) For the purposes of sub-paragraph (2)(b) the transfer of a dwelling, or the | |
grant of a lease of a dwelling, is made in pursuance of the preserved right to | |
buy if— | |
(a) the vendor is— | |
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(i) in England and Wales, a person against whom the right to | |
buy under Part 5 of the Housing Act 1985 (c. 68) is exercisable | |
by virtue of section 171A of that Act, or | |
(ii) in Scotland, a person against whom the right to buy under | |
section 61 of the Housing (Scotland) Act 1987 is exercisable | 5 |
by virtue of section 81A of that Act, | |
(which provide for the preservation of the right to buy on disposal to | |
a private sector landlord), | |
(b) the purchaser is the qualifying person for the purposes of the | |
preserved right to buy, and | 10 |
(c) the dwelling is the qualifying dwelling-house in relation to the | |
purchaser. | |
(5) A grant under section 20 or 21 of the Housing Act 1996 (c. 52) (purchase | |
grants in respect of disposals at a discount by registered social landlords) | |
does not count as part of the chargeable consideration for a right to buy | 15 |
transaction in relation to which the vendor is a registered social landlord. | |
Shared ownership lease: election for market value treatment | |
2 (1) This paragraph applies where— | |
(a) a lease is granted— | |
(i) by a qualifying body, or | 20 |
(ii) in pursuance of the preserved right to buy, | |
(b) the conditions in sub-paragraph (2) are met, and | |
(c) the purchaser elects for tax to be charged in accordance with this | |
paragraph. | |
(2) The conditions are as follows— | 25 |
(a) the lease must be of a dwelling; | |
(b) the lease must give the lessee or lessees exclusive use of the dwelling; | |
(c) the lease must provide for the lessee or lessees to acquire the | |
reversion; | |
(d) the lease must be granted partly in consideration of rent and partly | 30 |
in consideration of a premium calculated by reference to— | |
(i) the market value of the dwelling, or | |
(ii) a sum calculated by reference to that value; | |
(e) the lease must contain a statement of— | |
(i) the market value of the dwelling, or | 35 |
(ii) the sum calculated by reference to that value, | |
by reference to which the premium is calculated. | |
(3) An election for tax to be charged in accordance with this paragraph must be | |
included in the land transaction return made in respect of the grant of the | |
lease, or in an amendment of that return, and is irrevocable, so that the | 40 |
return may not be amended so as to withdraw the election. | |
(4) Where this paragraph applies the chargeable consideration for the grant of | |
the lease shall be taken to be the amount stated in the lease in accordance | |
with sub-paragraph (2)(e)(i) or (ii). | |
As to the tax treatment of the acquisition of the reversion in pursuance of the | 45 |
lease, see paragraph 3. | |
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(5) Section 118 (meaning of “market value”) does not apply in relation to the | |
reference in sub-paragraph (2)(e) above to the market value of the dwelling. | |
Transfer of reversion under shared ownership lease where election made for market value | |
treatment | |
3 The transfer of the reversion to the lessee or lessees under the terms of a lease | 5 |
to which paragraph 2 applies (shared ownership lease: election for market | |
value treatment) is exempt from charge if— | |
(a) an election was made for tax to be charged in accordance with that | |
paragraph, and | |
(b) any tax chargeable in respect of the grant of the lease has been paid. | 10 |
Shared ownership lease: election where staircasing allowed | |
4 (1) This paragraph applies where— | |
(a) a lease is granted by a qualifying body or in pursuance of the | |
preserved right to buy, | |
(b) the conditions in sub-paragraph (2) below are met, and | 15 |
(c) the purchaser elects for tax to be charged in accordance with this | |
paragraph. | |
(2) The conditions are as follows— | |
(a) the lease must be of a dwelling; | |
(b) the lease must give the lessee or lessees exclusive use of the dwelling; | 20 |
(c) the lease must provide that the lessee or lessees may, on the payment | |
of a sum, require the terms of the lease to be altered so that the rent | |
payable under it is reduced; | |
(d) the lease must be granted partly in consideration of rent and partly | |
in consideration of a premium calculated by reference to— | 25 |
(i) the premium obtainable on the open market for the grant of | |
a lease containing the same terms as the lease but with the | |
substitution of the minimum rent for the rent payable under | |
the lease, or | |
(ii) a sum calculated by reference to that premium; | 30 |
(e) the lease must contain a statement of the minimum rent and of— | |
(i) the premium obtainable on the open market, or | |
(ii) the sum calculated by reference to that premium, | |
by reference to which the premium is calculated. | |
(3) An election for tax to be charged in accordance with this paragraph must be | 35 |
included in the land transaction return made in respect of the grant of the | |
lease, or in an amendment of that return, and is irrevocable, so that the | |
return may not be amended so as to withdraw the election. | |
(4) Where this paragraph applies— | |
(a) the rent in consideration of which the lease is granted shall be taken | 40 |
to be the minimum rent stated in the lease in accordance with sub- | |
paragraph (2)(e), and | |
(b) the chargeable consideration for the grant other than rent shall be | |
taken to be the amount stated in the lease in accordance with sub- | |
paragraph (2)(e)(i) or (ii). | 45 |
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(5) In this paragraph the “minimum rent” means the lowest rent which could | |
become payable under the lease if it were altered as mentioned in sub- | |
paragraph (2)(c) at the date when the lease is granted. | |
Shared ownership leases: meaning of “qualifying body” and “preserved right to buy” | |
5 (1) This paragraph has effect for the purposes of paragraphs 2 and 4 (shared | 5 |
ownership leases: election as to basis of taxation). | |
(2) A “qualifying body” means— | |
(a) a local housing authority within the meaning of the Housing Act | |
1985 (c. 68); | |
(b) a housing association within the meaning of— | 10 |
(i) the Housing Associations Act 1985 (c. 69), or | |
(ii) Part 2 of the Housing (Northern Ireland) Order 1992 (S.I. | |
1992/1725 (N.I. 15)); | |
(c) a housing action trust established under Part 3 of the Housing Act | |
1988 (c. 50); | 15 |
(d) the Northern Ireland Housing Executive; | |
(e) the Commission for the New Towns; | |
(f) a development corporation established by an order made, or having | |
effect as if made, under the New Towns Act 1981 (c. 64). | |
(3) A lease is granted “in pursuance of the preserved right to buy” if— | 20 |
(a) the vendor is a person against whom the right to buy under Part 5 of | |
the Housing Act 1985 is exercisable by virtue of section 171A of that | |
Act (preservation of right to buy on disposal to private sector | |
landlord), | |
(b) the lessee is, or lessees are, the qualifying person for the purposes of | 25 |
the preserved right to buy, and | |
(c) the lease is of a dwelling that is the qualifying dwelling-house in | |
relation to the purchaser. | |
Rent to mortgage or rent to loan: chargeable consideration | |
6 (1) The chargeable consideration for a rent to mortgage or rent to loan | 30 |
transaction is determined in accordance with this paragraph. | |
(2) A “rent to mortgage transaction” means— | |
(a) the transfer of a dwelling to a person, or | |
(b) the grant of a lease of a dwelling to a person, | |
pursuant to the exercise by that person of the right to acquire on rent to | 35 |
mortgage terms under Part 5 of the Housing Act 1985. | |
(3) The chargeable consideration for such a transaction is equal to the price that, | |
by virtue of section 126 of the Housing Act 1985, would be payable for— | |
(a) a transfer of the dwelling to the person (where the rent to mortgage | |
transaction is a transfer), or | 40 |
(b) the grant of a lease of the dwelling to the person (where the rent to | |
mortgage transaction is the grant of a lease), | |
if the person were exercising the right to buy under Part 5 of that Act. | |
(4) A “rent to loan transaction” means the execution of a heritable disposition in | |
favour of a person pursuant to the exercise by that person of the right to | 45 |
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