In M Brown and another v HMRC [2022] UKUT 298 (TCC) (15 November 2022) the Upper Tribunal (UT) held that a marketed SDLT scheme failed. The scheme involved a distribution in specie of a house by a company and was intended to result in no liability under the former sub-sale rules in FA 2003 s 45.
Under the scheme the taxpayers formed an unlimited company and contributed cash of sufficient amount to purchase the target property by subscribing for shares. The property’s owner then contracted with the company for the sale of the property. The company paid the agreed price for the property and at the same time as the completion of the sale the company reduced its capital and made a distribution in specie of the property to the taxpayers. The taxpayers argued that the effect of s 45 was that the...
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In M Brown and another v HMRC [2022] UKUT 298 (TCC) (15 November 2022) the Upper Tribunal (UT) held that a marketed SDLT scheme failed. The scheme involved a distribution in specie of a house by a company and was intended to result in no liability under the former sub-sale rules in FA 2003 s 45.
Under the scheme the taxpayers formed an unlimited company and contributed cash of sufficient amount to purchase the target property by subscribing for shares. The property’s owner then contracted with the company for the sale of the property. The company paid the agreed price for the property and at the same time as the completion of the sale the company reduced its capital and made a distribution in specie of the property to the taxpayers. The taxpayers argued that the effect of s 45 was that the...
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