SDLTM22010 - Reliefs: Compulsory purchase facilitating development

England, Scotland and Wales: Detailed rules

Where the purchase of a chargeable interest is by way of a compulsory purchase order made by the purchaser, the purchaser may claim relief from Stamp Duty Land Tax, if the purchase is to facilitate development by a third party.

In order to obtain relief, the purchaser must be the person who made the compulsory purchase order. This would usually be the local planning authority.

Any subsequent transfer of the chargeable interest to the third party is subject to Stamp Duty Land Tax in the normal way.

Effected by agreement

As long as the other conditions are fulfilled, it does not matter if the purchase is part of an agreement between the vendor and a third party.

Should the vendor agree to sell the land, and agree a price with the third party, as long as the subsequent sale, to the maker of the compulsory purchase order, is the subject of a compulsory purchase order the fact that there is an agreement as to terms is not a bar to obtaining the relief.

Development by third party

The purchase must be made to facilitate development of the land by a third party (that is, someone other than the maker of the compulsory purchase order) The term development has the same meaning

• for England and Wales as in Section 55 of the Town and Country Planning Act 1990
• for Scotland as in Section 26 Town and Country Planning (Scotland) Act 1997