Finance Act 2010

Stamp duty land taxE+W+S+N.I.

6Relief for first-time buyersE+W+S+N.I.

(1)Part 4 of FA 2003 (stamp duty land tax) is amended as follows.

(2)After section 57A insert—

57AAFirst-time buyers

(1)A land transaction is exempt from charge under section 55 if—

(a)it is a relevant acquisition of a major interest in land,

(b)the land consists entirely of residential property,

(c)the relevant consideration (see section 55) for the transaction (other than any consisting of rent) is more than £125,000 but not more than £250,000,

(d)the purchaser, or (if more than one) each of the purchasers, is a first-time buyer who intends to occupy the residential property as the purchaser's only or main residence, and

(e)(subject to subsection (4)) the transaction is not one of a number of linked transactions.

(2)In this section “first-time buyer” means a person who—

(a)has not previously been a purchaser in relation to a relevant acquisition of a major interest in land which consisted of or included residential property,

(b)has not previously acquired an equivalent interest in such land under the law of a territory outside the United Kingdom,

(c)has not previously been, or been one of the persons who was, “the person” for the purposes of section 71A, 72, 72A or 73 in a case where the first transaction within the meaning of the section concerned was a relevant acquisition of a major interest in land which consisted of or included residential property, and

(d)would not have been such a person for those purposes in such a case if the provisions mentioned in paragraph (c) had been in force, and had had effect in the territory concerned, at all material times (subject, where required, to appropriate modifications).

(3)In this section “relevant acquisition of a major interest in land” means an acquisition of a major interest in land other than—

(a)the grant of a lease for a term of less than 21 years, or

(b)the assignment of a lease which has less than 21 years to run.

(4)Subsection (1)(e) does not prevent a transaction being exempt from charge under section 55 if each of the linked transactions is one the subject-matter of which is land, or an interest in or right over land, which falls within section 116(1)(a), (b) or (c) by reason of its connection with the same building.

(3)After section 73C insert—

73CASections 71A to 73: first-time buyers

(1)Where section 71A, 72, 72A or 73 applies, the first transaction within the meaning of the section concerned is exempt from charge under section 55 if—

(a)the transaction is a relevant acquisition of a major interest in land,

(b)the land consists entirely of residential property,

(c)the relevant consideration (see section 55) for the transaction (other than any consisting of rent) is more than £125,000 but not more than £250,000,

(d)the person (within the meaning of the section concerned), or (if more than one) each of them, is a first-time buyer who intends to occupy the residential property as the person's only or main residence, and

(e)(subject to subsection (3)) the transaction is not one of a number of linked transactions.

(2)In subsection (1)—

  • “first-time buyer”, and

  • “relevant acquisition of a major interest in land”,

have the same meaning as in section 57AA.

(3)Subsection (4) of section 57AA applies for the purposes of this section.

(4)In section 110 (approval of regulations under general power), insert at the end—

(6)This section does not apply to regulations containing only provision varying section 57AA or 73CA, or paragraph 15 of Schedule 9, which does not increase any person's liability to tax.

(5)In Schedule 9 (right to buy, shared ownership leases etc), insert at the end—

First-time buyers

15(1)This paragraph applies where—

(a)a lease is granted as mentioned in sub-paragraph (1)(a) of paragraph 2 and the conditions in sub-paragraph (2) of that paragraph are met but no election is made for tax to be charged in accordance with that paragraph,

(b)a lease is granted as mentioned in sub-paragraph (1)(a) of paragraph 4 and the conditions in sub-paragraph (2) of that paragraph are met but no election is made for tax to be charged in accordance with that paragraph,

(c)paragraph 4A applies in relation to the acquisition of an interest (but the acquisition is not exempt from charge by virtue of sub-paragraph (2) of that paragraph),

(d)a shared ownership trust is declared but no election is made for tax to be charged in accordance with paragraph 9, or

(e)an equity-acquisition payment is made under a shared ownership trust (but the equity-acquisition payment, and the consequential increase in the purchaser's beneficial interest, are not exempt from charge by virtue of paragraph 10).

(2)Neither section 57AA nor section 73CA applies in relation to—

(a)the acquisition of the lease,

(b)the acquisition of the interest,

(c)the declaration of the shared ownership trust, or

(d)the equity-acquisition payment and the consequential increase in the purchaser's beneficial interest.

(6)The amendments made by this section have effect in relation to any land transaction of which the effective date is on or after 25 March 2010 but before 25 March 2012.

7Rate in respect of residential property where consideration over £1mE+W+S+N.I.

(1)In section 55(2) of FA 2003 (amount of SDLT chargeable), in Table A (bands and percentages for residential property), for the final entry (cases where relevant consideration is more than £500,000 to be chargeable at 4%) substitute—

More than £500,000 but not more than £1,000,0004%
More than £1,000,0005%

(2)The amendment made by subsection (1) has effect in relation to any land transaction of which the effective date is on or after 6 April 2011.

(3)But that amendment does not have effect in relation to any transaction—

(a)effected in pursuance of a contract entered into and substantially performed before 25 March 2010, or

(b)effected in pursuance of a contract entered into before that date and not excluded by subsection (4).

(4)A transaction effected in pursuance of a contract entered into before 25 March 2010 is excluded by this subsection if—

(a)there is any variation of the contract, or assignment (or assignation) of rights under the contract, on or after 25 March 2010,

(b)the transaction is effected in consequence of the exercise on or after that date of any option, right of pre-emption or similar right, or

(c)on or after that date there is an assignment (or assignation), subsale or other transaction relating to the whole or part of the subject-matter of the contract as a result of which a person other than the purchaser under the contract becomes entitled to call for a conveyance.