Stamp Duty Land Tax – Lease Determination

What does it do?
Up to 100% Reduction in Stamp Duty Land Tax on Property Acquisitions

Who is it for?
Anyone wishing to purchase (or sell) freehold or long leasehold property over £1,000,000. This applies to individuals, companies, trusts, pension funds or any other acquirer of property in the UK.

Key Points

Needs to be implemented prior to exchange of contract
Can be applied to either freeholds or long leaseholds
Requires the consent of both the vendor and the purchaser
Requires active assistance from the vendor
The structure self liquidates giving unencumbered title
No deterioration in lender’s security position

Fee Structure
Our fees are a % of the value which would otherwise be subject to SDLT:

£1 Million to £5 Million	1 ½% (Min £10,000)
£5 to £10 Million	1% on excess plus max above
Thereafter	By agreement

Fees for this arrangement are mainly contingent; they are payable on completion, and are refundable if an enquiry is raised, and lost, in the nine month enquiry window.

Risks
This tax planning is legitimate in both principle and practice. Full disclosure will be made in each case, but it may nonetheless be challenged by HM Revenue & Customs. In the event a challenge is successful, the benefit of Counsel’s Opinions means that penalties will not be levied. The only likely cost over and above the SDLT is an amount of interest at official rates calculated from the due date to the date actually paid.

Implemented?
Yes, in a variety of scenarios.

Counsel’s Opinions
Reg Nock, 24 Old Buildings, Lincolns Inn (Feb 05)
Patrick Cannon, 24 Old Buildings, Lincolns Inn (Dec 04)
Patrick Way, Gray’s Inn Chambers, Gray’s Inn (Nov 03)

Disclosability
This planning has been disclosed under the SDLT Tax Avoidance Regulations 2005.