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1. A number
of stamp duty land tax measures were announced on Budget Day, 16
March 2005.
2. The following measures have already been enacted in Finance
Act 2005:
- the increase in the residential threshold from £60,000
to £120,000
- the withdrawal (subject to transitional provisions) of disadvantaged
areas relief for transactions in non-residential property
- the extension of relief for alternative property finance mechanisms
3. Other measures were announced, but were not included in Finance
Act 2005. These measures have now been included in the Finance Bill
published on 26 May 2005 (as Schedule 10). However the following
changes have been made:
- The measure on sale and leaseback arrangements which was announced
in the Budget is not included in this Finance Bill.
- In response to representations, the measure on loans and deposits
on the grant or assignment of a lease (paragraph 14 of Schedule
10) is amended so as to exempt a deposit which does not exceed
two years' rent (that is, twice the amount of the highest
rent payable in any twelve-month period for the five years following
the grant or assignment).
- The provisions on withdrawal of group relief (paragraph 4 of
Schedule 10) are amended so as to clarify that where the relevant
transaction was the grant of a lease the charge on withdrawal
of group relief is on the market value of the lease, together
with any rent payable.
- The commencement date of the measures originally announced
in the Budget is amended. These measures will now apply (broadly
speaking) to any transaction with an effective date after 19 May
2005. With one exception there is no change to the transitional
provisions, which apply only to contracts entered into on or before
16 March 2005. The exception is the measure mentioned in the previous
bullet point, where the transitional provisions apply to contracts
entered into on or before 19 May 2005.
4. More details are in the explanatory notes on the Finance Bill
published by HM Treasury, which can be found on HM
Treasury's website
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