The Land Registry has announced changes to the Stamp Duty Land Tax arrangements for sub-sales.
The Finance Act 2013 has led to changes to the regime for claiming relief for sub-sale transactions entered into on or after 17 July 2013.
Different requirements apply depending on whether two transfers are involved (i.e. A to B, then B to C) or just one transfer (i.e. where A transfers direct to C).
Two transfers
In the case of two transfers where A transfers to B, then B transfers to C, both transfers are notifiable.
The intermediate purchaser (B) must send an SDLT return to HMRC in order to claim the relief. Land Registry does not require two SDLT certificates, unless B wants to be registered, at least momentarily, as proprietor.
If B wishes to register its interest in the land, it will need to produce an SDLT5 together with its application for registration and the transfer from A to B, in the normal way.
If B does not wish to register its interest in the land, C will need to produce C’s SDLT5, its application for registration and the transfers from A to B and B to C.
C should also either: – (i) confirm in writing that B acquired the land from A and transferred it to C in pursuance of a “free-standing transfer” for the purposes of Schedule 2A to the Finance Act 2003, or – (ii) produce written confirmation from B (or B’s agent) to that effect.
One transfer
If there is only one transfer of the land (i.e. A to C), we only need the transfer to C with its application for registration and C’s SDLT5.
To read the full guidance please click here.
