SCHEDULES
SCHEDULE 4Stamp duty land tax: chargeable consideration
Money or money’s worth
1
1
The chargeable consideration for a transaction is, except as otherwise expressly provided, any consideration in money or money’s worth given for the subject-matter of the transaction, directly or indirectly, by the purchaser or a person connected with him.
2
F21Section 1122 of the Corporation Tax Act 2010 (connected persons) applies for the purposes of sub-paragraph (1).
Value added tax
2
The chargeable consideration for a transaction shall be taken to include any value added tax chargeable in respect of the transaction, other than value added tax chargeable by virtue of an F20option to tax any land under Part 1 of Schedule 10 to the Value Added Tax Act 1994 (c. 23) made after the effective date of the transaction.
Postponed consideration
3
The amount or value of the chargeable consideration for a transaction shall be determined without any discount for postponement of the right to receive it or any part of it.
Just and reasonable apportionment
4
1
For the purposes of this Part consideration attributable—
a
to two or more land transactions, or
b
in part to a land transaction and in part to another matter, or
c
in part to matters making it chargeable consideration and in part to other matters,
shall be apportioned on a just and reasonable basis.
2
If the consideration is not so apportioned, this Part has effect as if it had been so apportioned.
3
For the purposes of this paragraph any consideration given for what is in substance one bargain shall be treated as attributable to all the elements of the bargain, even though—
a
separate consideration is, or purports to be, given for different elements of the bargain, or
b
there are, or purport to be, separate transactions in respect of different elements of the bargain.
Exchanges
5
1
This paragraph applies to determine the chargeable consideration where one or more land transactions are entered into by a person as purchaser (alone or jointly) wholly or partly in consideration of one or more other land transactions being entered into by him (alone or jointly) as vendor.
2
In this paragraph—
a
“relevant transaction” means any of those transactions, and
b
“relevant acquisition” means a relevant transaction entered into as purchaser and “relevant disposal” means a relevant transaction entered into as vendor.
3
The following rules apply if the subject-matter of any of the relevant transactions is a major interest in land—
a
where a single relevant acquisition is made, the chargeable consideration for the acquisition is—
F24i
the amount determined under sub-paragraph (3A) in respect of the acquisition, or
ii
if greater, the amount which would be the chargeable consideration for the acquisition ignoring paragraph 5;
b
where two or more relevant acquisitions are made, the chargeable consideration for each relevant acquisition is—
F25i
the amount determined under sub-paragraph (3A) in respect of that acquisition, or
ii
if greater, the amount which would be the chargeable consideration for that acquisition ignoring paragraph 5;
F233A
The amount mentioned in sub-paragraph (3)(a)(i) and (b)(i) is—
a
the market value of the subject-matter of the acquisition, and
b
if the acquisition is the grant of a lease at a rent, that rent.
4
The following rules apply if the subject-matter of none of the relevant transactions is a major interest in land—
a
where a single relevant acquisition is made in consideration of one or more relevant disposals, the chargeable consideration for the acquisition is the amount or value of any chargeable consideration other than the disposal or disposals that is given for the acquisition;
b
where two or more relevant acquisitions are made in consideration of one or more relevant disposals, the chargeable consideration for each relevant acquisition is the appropriate proportion of the amount or value of any chargeable consideration other than the disposal or disposals that is given for the acquisitions.
5
For the purposes of sub-paragraph (4)(b) the appropriate proportion is—
where—
MV is the market value of the subject-matter of the acquisition for which the chargeable consideration is being determined, and
TMV is the total market value of the subject-matter of all the relevant acquisitions.
6
F57
This paragraph does not apply in a case to which paragraph 17 applies.
Partition etc: disregard of existing interest
6
In the case of a land transaction giving effect to a partition or division of a chargeable interest to which persons are jointly entitled, the share of the interest held by the purchaser immediately before the partition or division does not count as chargeable consideration.
Valuation of non-monetary consideration
7
Except as otherwise expressly provided, the value of any chargeable consideration for a land transaction, other than—
a
money (whether in sterling or another currency), or
b
debt as defined for the purposes of paragraph 8 (debt as consideration),
shall be taken to be its market value at the effective date of the transaction.
Debt as consideration
C18
1
Where the chargeable consideration for a land transaction consists in whole or in part of—
a
the satisfaction or release of debt due to the purchaser or owed by the vendor, or
b
the assumption of existing debt by the purchaser,
the amount of debt satisfied, released or assumed shall be taken to be the whole or, as the case may be, part of the chargeable consideration for the transaction.
F151A
Where—
a
debt is secured on the subject-matter of a land transaction immediately before and immediately after the transaction, and
b
the rights or liabilities in relation to that debt of any party to the transaction are changed as a result of or in connection with the transaction,
then for the purposes of this paragraph there is an assumption of that debt by the purchaser, and that assumption of debt constitutes chargeable consideration for the transaction.
1B
Where in a case in which sub-paragraph (1)(b) applies—
a
the debt assumed is or includes debt secured on the property forming the subject-matter of the transaction, and
b
immediately before the transaction there were two or more persons each holding an undivided share of that property, or there are two or more such persons immediately afterwards,
the amount of secured debt assumed shall be determined as if the amount of that debt owed by each of those persons at a given time were the proportion of it corresponding to his undivided share of the property at that time.
1C
For the purposes of sub-paragraph (1B), F27... each joint tenant of property is treated as holding an equal undivided share of it.
2
If the effect of F16this paragraph would be that the amount of the chargeable consideration for the transaction exceeded the market value of the subject-matter of the transaction, the amount of the chargeable consideration is treated as limited to that value.
3
In this paragraph—
a
“debt” means an obligation, whether certain or contingent, to pay a sum of money either immediately or at a future date,
b
“existing debt”, in relation to a transaction, means debt created or arising before the effective date of, and otherwise than in connection with, the transaction, and
c
references to the amount of a debt are to the principal amount payable or, as the case may be, the total of the principal amounts payable, together with the amount of any interest that has accrued due on or before the effective date of the transaction.
F11Cases where conditions for exemption not fully met
8A
1
Where a land transaction would be exempt from charge under paragraph 3A of Schedule 3 (assents and appropriations by personal representatives) but for sub-paragraph (2) of that paragraph (cases where person acquiring property gives consideration for it), the chargeable consideration for the transaction does not include the amount of any secured debt assumed.
“Secured debt” has the same meaning as in that paragraph.
2
Where a land transaction would be exempt from charge under paragraph 4 of Schedule 3 (variation of testamentary dispositions etc) but for a failure to meet the condition in sub-paragraph (2)(b) of that paragraph (no consideration other than variation of another disposition), the chargeable consideration for the transaction does not include the making of any such variation as is mentioned in that sub-paragraph.
Conversion of amounts in foreign currency
9
1
References in this Part to the amount or value of the consideration for a transaction are to its amount or value in sterling.
2
For the purposes of this Part the sterling equivalent of an amount expressed in another currency shall be ascertained by reference to the London closing exchange rate on the effective date of the transaction (unless the parties have used a different rate for the purposes of the transaction).
Carrying out of works
10
1
Where the whole or part of the consideration for a land transaction consists of the carrying out of works of construction, improvement or repair of a building or other works to enhance the value of land, then—
a
to the extent that the conditions specified in sub-paragraph (2) are met, the value of the works does not count as chargeable consideration, and
b
to the extent that those conditions are not met, the value of the works shall be taken into account as chargeable consideration.
2
The conditions referred to in sub-paragraph (1) are—
a
that the works are carried out after the effective date of the transaction,
b
that the works are carried out on land acquired or to be acquired under the transaction or on other land held by the purchaser or a person connected with him, and
c
that it is not a condition of the transaction that the works are carried out by the vendor or a person connected with him.
F172A
F18Where by virtue of—
a
subsection (8) of section 44 (contract and conveyance),
b
paragraph 12A of Schedule 17A (agreement for lease), or
F28c
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there are two notifiable transactions (the first being the contract or agreement and the second being the transaction effected on completion or, as the case may be, the grant or execution of the lease), the condition in sub-paragraph (2)(a) is treated as met in relation to the second transaction if it is met in relation to the first.
3
In this paragraph—
a
references to the acquisition of land are to the acquisition of a major interest in it;
b
the value of the works shall be taken to be the amount that would have to be paid in the open market for the carrying out of the works in question.
4
Section 839 of the Taxes Act 1988 (connected persons) has effect for the purposes of this paragraph.
F15
This paragraph is subject to paragraph 17 (arrangements involving public or educational bodies).
Provision of services
11
F21
Where the whole or part of the consideration for a land transaction consists of the provision of services (other than the carrying out of works to which paragraph 10 applies), the value of that consideration shall be taken to be the amount that would have to be paid in the open market to obtain those services.
F32
This paragraph is subject to paragraph 17 (arrangements involving public or educational bodies).
Land transaction entered into by reason of employment
12
1
Where a land transaction is entered into by reason of the purchaser’s employment, or that of a person connected with him, then—
a
if the transaction gives rise to a charge to tax under Chapter 5 of Part 3 of the Income Tax (Earnings and Pensions) Act 2003 (c. 1) (taxable benefits: living accommodation) and—
i
no rent is payable by the purchaser, or
ii
the rent payable by the purchaser is less than the cash equivalent of the benefit calculated under section 105 or 106 of that Act,
there shall be taken to be payable by the purchaser as rent an amount equal to the cash equivalent chargeable under those sections;
b
if the transaction would give rise to a charge under that Chapter but for section 99 of that Act (accommodation provided for performance of duties), the consideration for the transaction is the actual consideration (if any);
c
if neither paragraph (a) nor paragraph (b) applies, the 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 purposes of this paragraph.
Obligations under lease
F1213
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Surrender of existing lease in return for new lease
F1214
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Indemnity given by purchaser
16
Where the purchaser agrees to indemnify the vendor in respect of liability to a third party arising from breach of an obligation owed by the vendor in relation to the land that is the subject of the transaction, neither the agreement nor any payment made in pursuance of it counts as chargeable consideration.
F19Purchaser bearing inheritance tax liability
Sch. 4 paras. 16A-16C inserted (with effect in accordance with reg. 1(2) of the amending S.I.) by The Stamp Duty Land Tax (Amendment to the Finance Act 2003) Regulations 2006 (S.I. 2006/875), regs. 1(1), 3
16A
Where—
a
there is a land transaction that is—
i
a transfer of value within section 3 of the Inheritance Tax Act 1984 (transfers of value), or
ii
a disposition, effected by will or under the law of intestacy, of a chargeable interest comprised in the estate of a person immediately before his death,
and
b
the purchaser is or becomes liable to pay, agrees to pay or does in fact pay any inheritance tax due in respect of the transfer or disposition,
his liability, agreement or payment does not count as chargeable consideration for the transaction.
Purchaser bearing capital gains tax liability
16B
1
Where—
a
there is a land transaction under which the chargeable interest in question—
i
is acquired otherwise than by a bargain made at arm’s length, or
ii
is treated by section 18 of the Taxation of Chargeable Gains Act 1992 (connected persons) as so acquired,
and
b
the purchaser is or becomes liable to pay, or does in fact pay, any capital gains tax due in respect of the corresponding disposal of the chargeable interest,
his liability or payment does not count as chargeable consideration for the transaction.
2
Sub-paragraph (1) does not apply if there is chargeable consideration for the transaction (disregarding the liability or payment referred to in sub-paragraph (1)(b)).
Costs of enfranchisement
16C
Costs borne by the purchaser under section 9(4) of the Leasehold Reform Act 1967 or section 33 of the Leasehold Reform, Housing and Urban Development Act 1993 (costs of enfranchisement) do not count as chargeable consideration.
F4Arrangements involving public or educational bodies
Sch. 4 para. 17 added (19.12.2003) by The Stamp Duty Land Tax (Amendment of Schedule 4 to the Finance Act 2003) Regulations 2003 (S.I. 2003/3293), regs. 1, 2(5)
17
1
This paragraph applies in any case where arrangements are entered into under which—
F8a
there is a transfer, or the grant or assignment of a lease, of land by a qualifying body (“A”) to a non-qualifying body (“B”) (“the main transfer”),
F10b
in consideration (whether in whole or in part) of the main transfer there is a grant by B to A of a lease or under-lease of the whole, or substantially the whole, of that land (“the leaseback”),
c
B undertakes to carry out works or provide services to A, and
d
some or all of the consideration given by A to B for the carrying out of those works or the provision of those services is consideration in money,
F7whether or not there is also a transfer, or the grant or assignment of a lease, of any other land by A to B (a “transfer of surplus land”).
2
The following are qualifying bodies—
a
public bodies within section 66,
b
institutions within the further education sector or the higher education sector within the meaning of 91 of the Further and Higher Education Act 1992,
c
further education corporations within the meaning of section 17 of that Act,
F22ca
sixth form college corporations within the meaning of section 90 of that Act,
d
higher education corporations within the meaning section 90 of that Act,
e
persons who undertake to establish and maintain, and carry on, or provide for the carrying on, of an Academy within the meaning of F26section 1 of the Academies Act 2010 , and
f
in Scotland, institutions funded by the Scottish Further Education Funding Council or the Scottish Higher Education Funding Council.
F93
The following shall not count as chargeable consideration for the main transfer or any transfer of surplus land—
a
the lease-back;
b
the carrying out of building works by B for A; or
c
the provision of services by B to A.
4
The chargeable consideration for the lease back does not include—
a
the main transfer;
b
any transfer of surplus land; or
c
the consideration in money paid by A to B for the building works or other services referred to in sub-paragraph (3).
F134A
Sub-paragraphs (3) and (4) shall be disregarded for the purposes of determining whether the land transaction in question is notifiable.
F295
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6
In this paragraph “under-lease” includes a sub-lease.
Sch. 4 para. 8A and cross-heading inserted (with effect in accordance with s. 301(7) of the amending Act) by Finance Act 2004 (c. 12), s. 301(5)