PART 6 continued
(1) In Schedule 3 to the Finance Act 2003 (c. 14) (stamp duty land tax: transactions exempt from charge), after paragraph 3 insert—
3A (1) The acquisition of property by a person in or towards satisfaction of his entitlement under or in relation to the will of a deceased person, or on the intestacy of a deceased person, is exempt from charge.
(2) Sub-paragraph (1) does not apply if the person acquiring the property gives any consideration for it, other than the assumption of secured debt.
(3) Where sub-paragraph (1) does not apply because of sub-paragraph (2), the chargeable consideration for the transaction is determined in accordance with paragraph 8A(1) of Schedule 4.
(4) In this paragraph—
“debt” means an obligation, whether certain or contingent, to pay a sum of money either immediately or at a future date, and
“secured debt” means debt that, immediately after the death of the deceased person, is secured on the property.”.
(2) The amendment made by this section is deemed always to have had effect.
(1) In Schedule 3 to the Finance Act 2003 (transactions exempt from charge), in paragraph 4 (variation of testamentary dispositions etc) after sub-paragraph (2) insert—
“(2A) Where the condition in sub-paragraph (2)(b) is not met, the chargeable consideration for the transaction is determined in accordance with paragraph 8A(2) of Schedule 4.”.
(2) Schedule 4 to that Act (stamp duty land tax: chargeable consideration) is amended as follows.
(3) In paragraph 8 (debt as consideration), after sub-paragraph (1) insert—
“(1A) 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), in England and Wales and Northern Ireland each joint tenant of property is treated as holding an equal undivided share of it.”.
(4) In sub-paragraph (2) of that paragraph, for “sub-paragraph (1)” substitute “this paragraph”.
(5) After paragraph 8 insert—
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.”.
(6) The amendments made by subsections (3) and (4) apply in relation to any transaction of which the effective date (within the meaning of Part 4 of the Finance Act 2003 (c. 14)) is on or after the day on which this act is passed.
(7) The other amendments made by this section are deemed always to have had effect.
(1) In Schedule 8 to the Finance Act 2003 (stamp duty land tax: charities relief), after paragraph 2 insert—
3 (1) This paragraph applies where—
(a) a land transaction is not exempt from charge under paragraph 1 because the first condition in that paragraph is not met, but
(b) the purchaser (“C”) intends to hold the greater part of the subject-matter of the transaction for qualifying charitable purposes.
(2) In such a case—
(a) the transaction is exempt from charge, but
(b) for the purposes of paragraph 2 (withdrawal of charities relief) “disqualifying event” includes—
(i) any transfer by C of a major interest in the whole or any part of the subject-matter of the transaction, or
(ii) any grant by C at a premium of a low-rental lease of the whole or any part of that subject-matter,
that is not made in furtherance of the charitable purposes of C.
(3) For the purposes of sub-paragraph (2)(b)(ii)—
(a) a lease is granted “at a premium” if there is consideration other than rent, and
(b) a lease is a “low-rental” lease if the annual rent (if any) does not exceed £600 a year.
(4) In relation to a transaction that, by virtue of this paragraph, is a disqualifying event for the purposes of paragraph 2—
(a) the date of the event for those purposes is the effective date of the transaction;
(b) paragraph 2 has effect as if—
(i) in sub-paragraph (1)(b), for “at the time of” there were substituted “immediately before”,
(ii) in sub-paragraph (4)(a), for “at the time of” there were substituted “immediately before and immediately after”, and
(iii) sub-paragraph (4)(b) were omitted.
(5) In this paragraph—
“qualifying charitable purposes” has the same meaning as in paragraph 1;
“rent” has the same meaning as in Schedule 5 (amount of tax chargeable: rent) and “annual rent” has the same meaning as in paragraph 9(2) of that Schedule.”.
(2) After paragraph 3 of that Schedule (inserted by subsection (1) above) insert—
4 (1) This Schedule applies in relation to a charitable trust as it applies in relation to a charity.
(2) In this paragraph “charitable trust” means—
(a) a trust of which all the beneficiaries are charities, or
(b) a unit trust scheme in which all the unit holders are charities,
and “charity” has the same meaning as in paragraph 1.
(3) In this Schedule as it applies by virtue of this paragraph—
(a) references to the purchaser in paragraphs (a) and (b) of paragraph 1(2) are to the beneficiaries or unit holders, or any of them;
(b) the reference to the purchaser in paragraph 2(3)(a) is to any of the beneficiaries or unit holders;
(c) the reference in paragraph 3(2)(b) to the charitable purposes of C is to those of the beneficiaries or unit holders, or any of them.”
(3) In paragraph 1(1) of that Schedule, for “this paragraph” substitute “this Schedule”.
(4) In paragraph 2(1) of that Schedule, for “paragraph 1 (charities relief)” substitute “this Schedule”.
(5) In section 81 (further return where relief withdrawn), in paragraph (c) of subsection (4) (meaning of “the disqualifying event”), after “paragraph 2(3)” insert “or 3(2)”.
(6) In section 87 (interest on unpaid tax), in paragraph (c) of subsection (4) (meaning of “the disqualifying event”), after “paragraph 2(3)” insert “or 3(2)”.
(7) This section applies in relation to any transaction of which the effective date (within the meaning of Part 4 of the Finance Act 2003 (c. 14)) is on or after the day on which this Act is passed.
(1) In Schedule 9 to the Finance Act 2003 (stamp duty land tax: right to buy, shared ownership leases etc), after paragraph 4 insert—
4A (1) This paragraph applies where under a shared ownership lease—
(a) the lessee or lessees have the right, on the payment of a sum, to require the terms of the lease to be altered so that the rent payable under it is reduced, and
(b) by exercising that right the lessee or lessees acquire an interest, additional to one already held, calculated by reference to the market value of the dwelling and expressed as a percentage of the dwelling or its value (a “share of the dwelling”).
(2) Such an acquisition is exempt from charge if—
(a) an election was made for tax to be charged in accordance with paragraph 2 or, as the case may be, paragraph 4 and any tax chargeable in respect of the grant of the lease has been paid, or
(b) immediately after the acquisition the total share of the dwelling held by the lessee or lessees does not exceed 80%.
(3) In this paragraph “shared ownership lease” means a lease granted—
(a) by a qualifying body, or
(b) in pursuance of the preserved right to buy,
in relation to which the conditions in paragraph 2(2) or 4(2) are met.
(4) Section 118 (meaning of “market value”) does not apply in relation to the references in this paragraph to the market value of the dwelling.”.
(2) In sub-paragraph (1) of paragraph 5 of that Schedule (meaning of “qualifying body” and “preserved right to buy”) for “2 and 4” substitute “2, 4 and 4A”.
(3) In Schedule 19 to that Act (stamp duty land tax: commencement and transitional provisions), in paragraph 7 (earlier related transactions under stamp duty), for sub-paragraph (2) substitute—
“(2) In paragraph 3 of Schedule 9 (relief for transfer of reversion under shared ownership lease where election made for market value treatment) and paragraph 4A of that Schedule (shared ownership lease: treatment of staircasing transaction) as they apply in a case where the original lease was granted before the implementation date—
(a) a reference to a lease to which paragraph 2 of that Schedule applies shall be read as a reference to a lease to which section 97 of the Finance Act 1980 applied (which made provision for stamp duty corresponding to that paragraph), and
(b) a reference to an election having been made for tax to be charged in accordance with paragraph 2 or 4 of that Schedule shall be read as a reference to the lease having contained a statement of the parties' intention such as is mentioned in section 97(2)(d) of the Finance Act 1980 or, as the case may be, paragraph (d) of section 108(5) of the Finance Act 1981 (which made provision for stamp duty corresponding to paragraph 4).”.
(4) Subsections (1) and (2) apply in relation to an acquisition after 17th March 2004.
(5) Subsection (3) is deemed to have come into force on 1st December 2003.
Schedule 41 to this Act (which makes provision with respect to the application of stamp duty land tax to certain transactions involving partnerships) has effect.
In paragraph 7 of Schedule 15 to the Finance Act 2003 (c. 14) (stamp duty land tax: joint and several liability of responsible partners) after sub-paragraph (1) insert—
“(1A) No amount may be recovered by virtue of sub-paragraph (1)(a) or (b) from a person who did not become a responsible partner until after the effective date of the transaction in respect of which the tax is payable.”