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Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017

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Settlements and bare trustsE+W

27(1)Sub-paragraph (3) applies in relation to a land transaction if—E+W

(a)the main subject-matter of the transaction consists of a major interest in one or more dwellings,

(b)the buyer (or one of them) is acting as trustee of a settlement, and

(c)under the terms of the settlement a beneficiary will be entitled to—

(i)occupy the dwelling or dwellings for life, or

(ii)income earned in respect of the dwelling or dwellings.

(2)Sub-paragraph (3) also applies in relation to a land transaction if—

(a)the main subject-matter of the transaction consists of a term of years absolute in a dwelling, and

(b)the buyer (or one of them) is acting as a trustee of a bare trust (within the meaning given by paragraph 2(1) and (2) of Schedule 8).

(3)Where this sub-paragraph applies in relation to a land transaction the beneficiary of the settlement or bare trust (rather than the trustee) is to be treated for the purposes of this Schedule as the buyer (or as one of them).

(4)Paragraphs 3(3) and 4 of Schedule 8 (trustees to be treated as the buyer) have effect subject to sub-paragraph (3).

28(1)Sub-paragraph (3) applies where—E+W

(a)a person is a beneficiary under a settlement,

(b)a major interest in a dwelling forms part of the trust property, and

(c)under the terms of the settlement, the beneficiary is entitled to—

(i)occupy the dwelling for life, or

(ii)income earned in respect of the dwelling.

(2)Sub-paragraph (3) also applies where—

(a)a person is a beneficiary under a bare trust (within the meaning given by paragraph 2(1) and (2) of Schedule 8), and

(b)a term of years absolute in a dwelling forms part of the trust property.

(3)Where this sub-paragraph applies—

(a)the beneficiary is to be treated for the purposes of this Schedule as holding the interest in the dwelling, and

(b)if the trustee of the settlement or bare trust disposes of the interest, the beneficiary is to be treated for the purposes of this Schedule as having disposed of it.

29(1)Where—E+W

(a)the main subject-matter of a land transaction consists of an interest other than a major interest in a dwelling, and

(b)sub-paragraph (2) or (3) applies in relation to the transaction,

then, for the avoidance of doubt, the effect of paragraph 28 of this Schedule or, as the case may be, paragraph 3(1) of Schedule 8, is that the main subject-matter of the transaction is to be treated for the purposes of this Schedule as consisting of a major interest in a dwelling.

(2)This sub-paragraph applies in relation to a transaction where—

(a)a major interest in the dwelling is held on a bare trust for a beneficiary (““B””),

(b)there is a disposal of the whole or part of B's interest in the dwelling,

(c)immediately before the effective date of the transaction—

(i)the major interest is, by virtue of paragraph 3(1) of Schedule 8, treated as if it were vested in B, or

(ii)B is, by virtue of paragraph 28, treated as holding the major interest in the dwelling, and

(d)immediately after the effective date of the transaction—

(i)the major interest is, by virtue of paragraph 3(1) of Schedule 8, treated as if it were vested in the buyer, or

(ii)the buyer is, by virtue of paragraph 28, treated as holding the major interest.

(3)This sub-paragraph applies in relation to a transaction where—

(a)a person (““B””) is a beneficiary under a settlement where a major interest in the dwelling forms part of the trust property,

(b)under the terms of the settlement B is entitled to—

(i)occupy the dwelling for life, or

(ii)income earned in respect of the dwelling,

(c)there is a disposal of the whole or part of B's interest in the dwelling,

(d)immediately before the effective date of the transaction B is, by virtue of paragraph 28, treated as holding the major interest in the dwelling, and

(e)immediately after the effective date of the transaction the buyer is, by virtue of that paragraph, treated as holding the major interest.

(4)In determining whether sub-paragraph (2) or (3) applies to a transaction, ignore paragraphs 30 and 35(5).

30(1)This paragraph applies where, by reason of paragraph 27 or 28 or paragraph 3(1) of Schedule 8 (bare trusts), the child of a person (““P””) would (but for this paragraph) be treated for the purposes of this Schedule as—E+W

(a)being the buyer in relation to a land transaction,

(b)holding an interest in a dwelling, or

(c)having disposed of an interest in a dwelling.

(2)Where this paragraph applies—

(a)P and any spouse or civil partner of P are to be treated for the purposes of this Schedule as being the buyer, holding the interest or (as the case may be) having disposed of the interest, and

(b)the child is not to be so treated.

(3)Sub-paragraph (2)(a) does not apply in relation to a spouse or civil partner of P if the two of them are not living together (for the meaning of which, see paragraph 25(3)).

(4)This paragraph does not apply where—

(a)a person (““D””) acquires, holds or disposes of, a major interest in a dwelling in a child's name or on the child's behalf,

(b)D does so in the exercise of powers conferred on D as the deputy of the child, and

(c)D holds or, in the case of a disposal, held, that interest on trust for the child.

(5)In sub-paragraph (4), “"deputy”” means—

(a)a person appointed under section 16 of the Mental Capacity Act 2005 (c. 9), or

(b)a person appointed to an equivalent position under the law of a country or territory outside England and Wales (and accordingly the reference to an interest being held on trust by such a person is to its being held on an equivalent basis under that law).

31(1)This paragraph applies in relation to a land transaction if—E+W

(a)the main subject-matter of the transaction consists of a major interest in one or more dwellings,

(b)the buyer (or one of them) is acting as trustee of a settlement,

(c)that buyer is an individual, and

(d)under the terms of the settlement a beneficiary is not entitled to—

(i)occupy the dwelling or dwellings for life, or

(ii)income earned in respect of the dwelling or dwellings.

(2)In determining whether paragraph 20 or 21 applies to the transaction—

(a)if the buyer mentioned in sub-paragraph (1) is the only buyer, ignore sub-paragraph (1)(a) of those paragraphs, and

(b)if that buyer is not the only buyer, ignore sub-paragraph (1)(a) of those paragraphs when having regard to that buyer.

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