Section 45A Aggregation of transactions
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Amendments
Section 45A inserted by Finance Act 2005 section 117 as respects instruments executed on or after 3 February 2005.
(1) In this section "dwellinghouse" includes apartment.
What anti-avoidance rules apply in relation to "segmented" transactions?
(1) This is an anti-avoidance section. It counters transactions which transfer the interest in a residential property (dwellinghouse) in segments, each of which is below the threshold. In this regard, a dwellinghouse includes an apartment.
(2) Where an existing interest or, as the case may be, existing interests, in a dwellinghouse are conveyed or transferred by more than one instrument, executed within a period of 12 months, subsection (3) shall apply to each of those instruments which operate as a conveyance or transfer, whether on sale or as a voluntary disposition inter vivos.
(3) An instrument to which this subsection applies shall be deemed for the purposes of the Heading "CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance" in Schedule 1 to form part of a larger transaction or of a series of transactions in respect of which the amount or value, or the aggregate amount or value, of the consideration which is attributable to residential property [is equal to the value of the dwellinghouse.]1
Amendments
1 Substituted by Finance Act 2008 section 113 as respects instruments executed on or after 5 November 2007.
(4) Where a conveyance or transfer (referred to in this section as the "first transfer") of an interest in a dwellinghouse is effected by one instrument and―
(a) before 1 March 2005 without regard to subsection (3), and
(b) on or after 1 March 2005 with or without regard to subsection (3),
the duty chargeable (if any) in respect of the instrument has been accounted for to the Commissioners, and one or more conveyances or transfers (referred to in this section as "subsequent transfers") of other interests in the same dwellinghouse are effected within the subsequent 12 month period, the transferee or where there is more than one transferee, each such transferee, being a party to the first transfer, jointly and severally, shall become liable to pay to the Commissioners [an amount (in this subsection referred to as a "clawback")]1 equal to the amount of the difference between-
(i) the amount of duty chargeable if the first transfer was one to which subsection (3) applied, and
(ii) any duty paid on that first transfer together with the amount of any [clawback]2 previously paid in respect of that first transfer under this subsection,
together with interest charged on [that amount calculated in a accordance with section 159D,]3 from the date when the instrument was executed to the date when the [clawback is remitted]4.
Amendments
1 Substituted by Finance (No. 2) Act 2008 section 98 and Schedule 5 Part 5 Chapter 2 para 7(d)(i) from 24 December 2008 and to the extent that Chapter 3A applies to penalties incurred under the Stamp Duties Consolidation Act 1999 before 24 December 2008 which by 24 December 2008 have not been paid, it shall not apply to such penalties which are in the form of interest accrued under any provisions of the act.
2 Substituted by Finance (No. 2) Act 2008 section 98 and Schedule 5 Part 5 Chapter 2 para 7(d)(ii) from 24 December 2008 and to the extent that Chapter 3A applies to penalties incurred under the Stamp Duties Consolidation Act 1999 before 24 December 2008 which by 24 December 2008 have not been paid, it shall not apply to such penalties which are in the form of interest accrued under any provisions of the act.
3 Substituted by Finance Act 2005 section 117(3) as respects interest to be charged for any day or part of a day on or after 1 April 2005 in respect of any amount due whether before, on or after that date under this section. Previously "that amount at a rate of 0.0322 per cent for each day or part of a day".
4 Substituted by Finance (No. 2) Act 2008 section 98 and Schedule 5 Part 5 Chapter 2 para 7(d)(iii) from 24 December 2008 and to the extent that Chapter 3A applies to penalties incurred under the Stamp Duties Consolidation Act 1999 before 24 December 2008 which by 24 December 2008 have not been paid, it shall not apply to such penalties which are in the form of interest accrued under any provisions of the act.
If one segment of the interest was conveyed prior to 1 March 2005 and subsequent transfers occurred after that date, how is the lost stamp duty recovered?
(4) This imposes a penalty to recover the stamp duty "lost" to Revenue. It applies where the first transfer occured before 1 March 2005 (without being treated as aggregated) and the subsequent transfers occur on or after 1 March 2005 (whether treated...
(5) For the purpose of subsection (4)(i), the amount of duty chargeable shall be determined without regard to relief under section 92B unless the transferee or, where there is more than one, each such transferee, being a party to either the first transfer or any subsequent transfers, are each a first time purchaser within the meaning of that section.
Is first time buyer relief taken into account when calculating the penalty component of the stamp duty?
(5) In calculating the stamp duty component of the penalty, applicable where a first-transfer is treated as a transfer of the entirety, first time buyer relief is ignored unless each transferee is treated as a first-time buyer.
(6) Where subsection (3) applies to an instrument conveying or transferring an interest in a dwellinghouse, relief under section 92B shall not apply to the instrument unless the transferee or, where there is more than one, each such transferee, being a party to either that conveyance or transfer or any previous conveyances or transfers of other interests in the same dwellinghouse executed in the previous 12 month period, are each a first time purchaser within the meaning of that section.
If I am a first time buyer, how does the aggregation provision affect my entitlement to claim the relief?
(6) First-time buyer relief does not apply to the entirety unless each transferee would have been treated as as a first-time buyer by reference to any transfer in the previous 12 months which is now caught as part of the aggregate transaction.
