SDLTM31400 - Application

Companies: Unit trust schemes FA03/S101

This section provides that the trustees of a unit trust scheme are treated as if they were a company. For the purposes of paying stamp duty land tax when a unit trust scheme acquires land see SDLTM30200+.

Except for the deemed market value rule under FA03/S53 and FA03/SCH7 in respect of group relief, reconstruction and acquisition reliefs do not apply. See SDLTM23000+.

The rights of unit holders are treated as if they are shares in the company. The issue, surrender and transfer of units within the scheme are not within the scope of stamp duty land tax. They continue to be subject to stamp duty reserve tax.

A unit trust scheme has the same meaning as in the Financial Services and Markets Act 2000 and a unit holder means a person entitled to a share of the investments subject to the trusts of a unit trust scheme.

An umbrella scheme is a unit trust scheme which has arrangements for separate pooling of the contributions of participants and the profits or income out of which payments are to be made and under which the participants are entitled to exchange rights in one pool for rights in another. A part of an umbrella scheme means such of the arrangements as relate to a separate pool.

Where there is an umbrella scheme each part is regarded as a separate unit trust and the scheme as a whole is not treated as a unit trust scheme for stamp duty land tax purposes. Therefore, where part of an umbrella scheme acquires land, that part is treated as a unit trust scheme in its own right and the trustees of that part will be treated as a company by virtue of FA03/S101(1)(a).

See FA03/S64A for details of the conditions to be met for the relief on the initial transfer of assets to the trustees of a unit trust scheme.