SDLT housebuilders relief

The CIOT has written to HMRC to ask whether partial relief from SDLT will be available where the members of an LLP are a mixture of qualifying and non-qualifying housebuilding companies.

In previous correspondence, HMRC confirmed that relief would be available for a housebuilder LLP operating a qualifying part-exchange scheme where all members of the LLP (or partners in a partnership) were housebuilding companies, as a result of the ‘look through’ provisions in FA 2003 Sch 15 para 2.

The question arises following Pollen Estate Trustee Co Ltd v HMRC [2013] STC 1479, where the Court of Appeal held that FA 2003 Sch 8 para 1(1) should be construed as providing that a land transaction was exempt from charge to the extent that the purchaser was a charity, providing that other relevant conditions were met, and that exemption would apply to ‘that proportion of the beneficial interest that is attributable to the undivided share held by the charity for qualifying charitable purposes’. This was an important distinction, meaning that an amount of relief was available even though not all the trust beneficiaries in the case were charities.