SDLTM04030A - Scope: How much is chargeable: Non-cash consideration: Land partitioned FA03/SCH4/PARA6: Example

Example 1

A and B own a farm jointly in equal shares.

They decide to partition the farm and it is agreed that A will take 50% of the land and B will take 50% of the land.

The total market value of the land is £2m.

If each half of the land is of equal value then no Stamp Duty Land Tax (SDLT) is chargeable.

Example 2

As example one above but

The land taken by A includes the farmhouse and farm buildings.

The land retained by A has a value of £300,000 greater than the land that is to be retained by B.

A’s share is worth £1,150,000 and B’s share is worth £850,000 so A compensates B by paying £150,000 to equalise the partition.

This £150,000 would be subject to a charge to SDLT.