SDLT Consultation

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04 February 2008

The Government has published a consultation paper entitled "Stamp Duty Land Tax: ensuring fairness for all" which sets out proposals for introducing an "Indirect Charge" to SDLT on the transfer of shares in special purpose vehicles used as a wrapper for residential property.

It is targeted at perceived avoidance of SDLT on the on-sale of such companies (on which stamp duty of 0.5% is paid rather than the higher rates of SDLT). The paper sets out three tests which must be met before the charge can bite. Firstly, there must be an acquisition of at least 75% of the SPV (the substantial interest test), second, the company must be controlled by 5 or fewer people (the limited ownership test), and third, 90% of the market value of its assets must consist of residential property (the property company test). It is proposed that the charge (at 4%) will be imposed on vehicles worth £1m or more.

The closing date for the consultation is 8 February 2008.

For further information, please contact: Nigel Popplewell ( on +44(0) 117 902 2782.

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