Part 4 U.K.Stamp duty land tax

Modifications etc. (not altering text)

C1 Pt. 4 construed as one with S.I. 2006/575, reg. 43 (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 43(4)

C2 Pt. 4 modified (coming into force at 2 p.m. on 6.12.2006) by The Stamp Duty Land Tax (Variation of the Finance Act 2003) Regulations 2006 (S.I. 2006/3237), regs. 1, 2, Sch.

C3 Pt. 4 modified (17.7.2013) by Finance Act 2013 (c. 29), s. 194(8)-(12)

C4 Pt. 4 applied (17.7.2014) by Finance Act 2014 (c. 26), ss. 223(8)(9)(d)

C5 Pt. 4 modified (temp.) (22.7.2020) by Stamp Duty Land Tax (Temporary Relief) Act 2020 (c. 15), s. 1 (as amended (10.6.2021) by 2021 c. 26, s. 87(2))

C6 Pt. 4 modified (temp.) (10.6.2021) by 2020 c. 15, s. 1A (as inserted by Finance Act 2021 (c. 26), s. 87(3))

Land transactions U.K.

[F1 45AContract providing for conveyance to third party: effect of transfer of rights U.K.

(1) This section applies where—

(a) a contract (“the original contract”) is entered into under which a chargeable interest is to be conveyed by one party to the contract (A) at the direction or request of the other (B)—

(i) to a person (C) who is not a party to the contract, or

(ii) either to such a person or to B,

and

(b) there is an assignment or other transaction (relating to the whole or part of the subject-matter of the original contract) as a result of which a person (D) becomes entitled to exercise any of B’s rights under the original contract in place of B.

References in the following provisions of this section to a transfer of rights are to any such assignment or other transaction.

(2) D is not regarded as entering into a land transaction by reason of the transfer of rights, but section 44A (contract providing for conveyance to third party) has effect in accordance with the following provisions of this section.

(3) That section applies as if—

(a) D had entered into a contract (a “secondary contract”) in the same terms as the original contract except with D as a party instead of B, and

(b) the consideration due from D under the secondary contract were—

(i) so much of the consideration under the original contract as is referable to the subject-matter of the transfer of rights and is to be given (directly or indirectly) by D or a person connected with him, and

(ii) the consideration given for the transfer of rights.

(4) The substantial performance of the original contract shall be disregarded if—

(a) it occurs at the same time as, and in connection with, the substantial performance of the secondary contract, or

(b) it occurs after the transfer of rights.

(5) Where there are successive transfers of rights, subsection (3) has effect in relation to each of them.

(6) The substantial performance of the secondary contract arising from an earlier transfer of rights shall be disregarded if—

(a) it occurs at the same time as, and in connection with, the substantial performance of the secondary contract arising from a subsequent transfer of rights, or

(b) it occurs after that subsequent transfer.

(7) Where a transfer of rights relates to only part of the subject matter of the original contract, or to only some of the rights under that contract—

(a) a reference in subsection (3)(a) or (4) to the original contract, or a reference in subsection (6) to the secondary contract arising from an earlier transfer, is to that contract so far as relating to that part or those rights, and

(b) that contract so far as not relating to that part or those rights shall be treated as a separate contract.

(8) The effective date of a land transaction treated as entered into by virtue of subsection (3) is not earlier than the date of the transfer of rights.

(9) In relation to a such a transaction—

(a) references in Schedule 7 (group relief) to the vendor shall be read as references to A;

(b) other references in this Part to the vendor shall be read, where the context permits, as referring to either A or B.

(10) [F2 Section 1122 of the Corporation Tax Act 2010] (connected persons) applies for the purposes of subsection (3)(b).

(11) In this section “contract” includes any agreement.]

Textual Amendments

F1 S. 45A inserted (with effect in accordance with Sch. 39 para. 13(2) of the amending Act) by Finance Act 2004 (c. 12), Sch. 39 para. 5(5)

F2 Words in s. 45A(10) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 403 (with Sch. 2)