Relief from multiple charges to stamp duty land tax is available
for three types of alternative property finance scheme, one of
which has two variants.
The result is that the stamp duty land tax payable is in line
with that which would be payable if a property was purchased using
a conventional mortgage product.
These reliefs are available to persons using alternative
property financing arrangements.
Where relief is claimed a land transaction return must be
completed claiming the relief and showing the chargeable
consideration as the price that has been agreed between the parties
to the transaction.
Land purchased by financial institution and leased to, or, in
Scotland, occupied by, person - This scheme receives relief across
the entire UK. A person(s) enters into arrangements with a
financial institution whereby the financial institution purchases
the property and grants the person a long lease with an option to
have the reversion, in Scotland, ownership, transferred.
The person makes regular payments during the term of the
lease. At the end of the lease, the person can exercise their right
and have the reversion, in Scotland, ownership, transferred to
themselves. See
SDLTM28100 and
SDLTM28200.
In England & Wales and Northern Ireland a variant of this
scheme is relieved. A property can be held in trust for the
financial institution and the person as beneficial tenants in
common.
The beneficial ownership can be transferred in any number of
transactions to the tenant during the course of the lease. The
right to have the reversion transferred at the end of the agreement
is maintained. See
SDLTM28100.
A separate scheme is relieved in Scotland. The person and the
financial institution purchase a major interest as owners in
common.
The person has a right to exclusive occupation during the
time of common ownership. The person has the right to require the
institution to transfer to them the whole interest. See
SDLTM28300.
Land purchased by financial institution and re-sold to person
- This relief is available to schemes anywhere in the UK.
A person(s) enters into arrangements with a financial
institution whereby the financial institution purchases a property
for £100,000 and sells it to them for £225,000. They then
pay this amount to the financial institution in instalments. See
SDLTM28400.
A financial institution means
Legal mortgage
