The Stamp Duty Land Tax Avoidance Schemes (Prescribed Descriptions of Arrangements) Regulations 2005

Regulation 2(3)(c)

SCHEDULE Excluded Arrangements

Arrangements are excluded from being prescribed arrangements for the purposes of these Regulations if they —

(a) comprise one or more of steps A to F listed below (subject to Rules 1 and 2 which specify arrangements involving combinations of those steps which are not excluded arrangements); but

(b) do not include any step, which is necessary for the purpose of securing a tax advantage, other than one listed below.

• Rule 1

  Arrangements involving Steps B, D, E and F are excluded arrangements unless rule 2 applies.

• Rule 2

  Arrangements are not excluded arrangements if they—

  (a)

  include all, or at least two of, steps A, C and D; or

  (b)

  involve more than one instance of step A, C or D.

The steps are as follows.

• Step A: Acquisition of a chargeable interest by special purpose vehicle

  The acquisition of a chargeable interest in land by a company created for that purpose (“a special purpose vehicle”).

• Step B: Claims to relief

  Making—

  (a)

  a single claim to relief under any of the following provisions of the Finance Act 2003—

  (i)

  section 57A (1),(sale and leaseback arrangements);

  (ii)

  section 60 (compulsory purchase facilitating development);

  (iii)

  section 61 (compliance with planning obligation);

  (iv)

  section 64 (demutualisation of building society);

  (v)

  section 64A (2) (initial transfer of assets to trustees of unit trust scheme);

  (vi)

  section 65 (incorporation of limited liability partnership);

  (vii)

  section 66 (transfers involving public bodies);

  (viii)

  section 67 (transfer in consequence of reorganisation of parliamentary constituencies);

  (ix)

  section 69 (acquisition by bodies established for national purposes);

  (x)

  section 71 (certain acquisitions by registered social landlords);

  (xi)

  section 74 (collective enfranchisement by leaseholders);

  (xii)

  section 75 (crofting community right to buy);

  (xiii)

  Schedule 6 (disadvantaged areas relief);

  (xiv)

  Schedule 6A (3)(relief for certain acquisitions of residential property);

  (xv)

  Schedule 7 (group relief and reconstruction acquisition reliefs);

  (xvi)

  Schedule 8 (charities relief); or

  (xvii)

  Schedule 9 (right to buy, shared ownership leases etc.);

  (b)

  one or more claims to relief under any one of the following provisions of the Finance Act 2003—

  (i)

  section 71A (4) (alternative property finance: land sold to financial institution and leased to individual);

  (ii)

  section 72 (5) (alternative property finance in Scotland: land sold to financial institution and leased to individual);

  (iii)

  section 72A(6) (alternative property finance in Scotland: land sold to financial institution and individual in common); or

  (iv)

  section 73 (alternative property finance: land sold to financial institution and resold to individual)(7).

• Step C: Sale of shares in special purpose vehicle

  The sale of shares in a special purpose vehicle, which holds a chargeable interest in land, to a person with whom neither the special purpose vehicle, nor the vendor, is connected.

• Step D: Not exercising election to waive exemption from VAT

  No election is made to waive exemption from value added tax contained in paragraph 2 of Schedule 10 to the Value Added Tax Act 1994(8) (treatment of buildings and land for value added tax purposes).

• Step E: Transfer of a business as a going concern

  Arranging the transfer of a business, connected with the land which is the subject of the arrangements, in such a way that it is treated for the purposes of value added tax as the transfer of a going concern.

• Step F: Undertaking a joint venture

  The creation of a partnership (within the meaning of paragraph 1 of Schedule 15 to the Finance Act 2003) to which the property subject to a land transaction is to be transferred.

(1)

Section 57A was inserted by paragraph 16 of Part 2 of Schedule 39 to the Finance Act 2004.

(2)

Section 64A was inserted by paragraph 18 of Part 2 of Schedule 39 to the Finance Act 2004.

(3)

Schedule 6A was inserted by paragraph 17(2) of Part 2 of Schedule 39 to the Finance Act 2004.

(4)

Section 71A was inserted by paragraph 2 of Schedule 8 to the Finance Act 2005 (c. 7).

(5)

Section 72 was amended by paragraph 3(1) and (6) of Schedule 8 to the Finance Act 2005.

(6)

Section 72A was inserted by paragraph 4 of Schedule 8 to the Finance Act 2005.

(7)

Section 73 was amended by paragraph 5(2) of of Schedule 8 to the Finance Act 2005.

(8)

1994 c. 16. Paragraph 2 has been amended by sections 36 and 37 of, and Part IV(2) of Schedule 18 to, the Finance Act 1997 (c. 16), article 2(a) of S.I. 1994/3013, article 3 of S.I. 1995/279, article 2(a) of S.I. 1997/51, articles 2 and 4 of S.I. 1999/593 and articles 2 and 4 of S.I. 2004/778.