SEARCH, INDEX, UPDATES, CONTENTS, INFORMATION, SDLT LINKED TRANSACTIONS
The rate of SDLT (Stamp Duty Land Tax) is based on the value of a transaction, or series of transactions. In some cases a series of transactions may not be recognised.
The regulations are intended to prevent the reduction of the SDLT payable by the artificial division of a single transaction into two or more parts.
Mr and Mrs X may wish to buy a house valued at £350,000 owned by Mr A.
Mrs X may wish to buy some land attached
valued at £100,000 owned by Mr A.
The sister of Mr X may wish to buy a cottage valued at £150,000 owned by Mr A.
Mr and Mrs X may not even be aware of Mr X's sisters plans, and Mr A may have no idea that they are related, however these are all linked transactions and 4% SDLT is due on each transaction because the total consideration exceeds £500,000.
Transactions are linked if they are between the same vendor and purchaser or, in either case, persons connected with them.
A person is connected with that person's spouse; a relative defined as a brother, sister, ancestor or lineal descendant; and the spouse of a relative. Nephews and nieces, uncles and aunts are not included in this definition of a relative. A husband and wife remain connected even if they are not living together, until a decree absolute has been granted.
A trustee is connected with the settlor and any person connected with the settlor. Business partners are connected with each other and any person connected with them. A company can be connected to another company, or to a person and anyone connected with that person when there is common control.
Reminder - disclaimer applies. Please feedback your comments. This page was last modified 25 June 2006.