The Mutual Societies (Transfers of Business) (Tax) Regulations 2009

PART 4 FURTHER PROVISIONS RELATING TO RELEVANT TRANSFERS

Stamp duty land tax – group relief

33.—(1) Paragraph 3 of Schedule 7 to FA 2003 (withdrawal of group relief)(1) does not apply if—

(a) there is a relevant transfer;

(b) before the date of that relevant transfer there had been a land transaction to which Part 1 of Schedule 7 to FA 2003 applied; and

(c) as a result of that relevant transfer, the purchaser in relation to the land transaction referred to in sub-paragraph (b) ceases to be a member of the same group as the transferor—

(i) before the end of the period of three years beginning with the effective date of that land transaction; or

(ii) in pursuance of, or in connection with, arrangements made before the end of that three year period.

(2) In this regulation, references to a company being a member of a group of companies are to be read in accordance with paragraph 1 of Schedule 7 to FA 2003(2).

Transitional provision

34.—(1) This regulation applies if a relevant transfer takes place on or after 22 April 2009 but before the date on which these Regulations come into force.

(2) Subject to paragraph (4) nothing in these Regulations shall have effect so as to—

(a) impose a charge to tax (or increase a charge to tax) on a party to the relevant transfer;

(b) reduce a relief from tax, including a tax credit, available to a party to the relevant transfer; or

(c) reduce losses available to a party to the relevant transfer;

where that charge or reduction arises only as a result of the application of these Regulations.

(3) If paragraph (2) applies—

(a) any charge to tax (or increase in a charge to tax) on a party to the relevant transfer;

(b) any reduction in relief from tax available to a party to the relevant transfer; or

(c) any reduction in losses available to a party to the relevant transfer;

shall be disregarded.

(4) Paragraphs (2) and (3) do not apply in relation to—

(a) any charge to tax (or increase in a charge to tax);

(b) any reduction in relief from tax; or

(c) any reduction in losses;

which may arise as a result of anything done or occurring on or after the date on which these Regulations come into force.

Arrangements the purpose of which is to secure a tax advantage

35.—(1) This regulation applies if a relevant transfer forms part of an unallowable arrangement.

(2) If paragraph (1) is satisfied the following Cases shall apply.

• Case 1

  Case 1 is where as a result of the arrangement any party to the relevant transfer obtains a relief from tax (including a tax credit) or an increased relief from tax.

  Where Case 1 applies, the relief from tax, or increased relief from tax, shall not be allowed.

• Case 2

  Case 2 is where as a result of the arrangement any party to the relevant transfer obtains a repayment of tax or an increased repayment of tax.

  Where Case 2 applies, the repayment of tax, or the increased repayment, shall not be allowed.

• Case 3

  Case 3 is where as a result of the arrangement any party to the relevant transfer avoids, reduces or delays a charge or assessment to tax.

  Where Case 3 applies, a charge or an assessment to tax may be made upon that party.

• Case 4

  Case 4 is where as a result of the arrangement any party to the relevant transfer avoids a possible assessment to tax.

  Where Case 4 applies, an assessment to tax may be made upon that party.

(3) For the purposes of this regulation an arrangement is an unallowable arrangement where the purpose, or one of the main purposes, of a person in being a party to the relevant transfer is to obtain a tax advantage as a result of that transfer for that person or any other person.

(1)

2003 c. 14. Paragraph 3(2) was substituted by paragraph 4(a) of Schedule 10 to the Finance (No 2) Act 2005 (c. 22).

(2)

Paragraph 1 has been amended by paragraphs 1 and 3 of Schedule 10 to the Finance (No. 2) Act 2005.