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HMRC internal manual

Stamp Duty Land Tax Manual

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HM Revenue & Customs
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Reliefs: Right to buy transactions, shared ownership leases etc: Definition of right to buy FA03/SCH9/PARA1

A right to buy transaction is defined as either

  • the sale of a dwelling at a discount (or the grant of a lease of a dwelling at a discount) by a relevant public sector body. Relevant public sector bodies are

Government

A Minister of the Crown

The Scottish Ministers

A Northern Ireland Department

Local Government

A local housing authority within the meaning of the Housing Act 1985

A county council in England

A council constituted under Section 2 of the Local Government etc (Scotland) Act 1994, the common good of such a council or any trust under its control

A district council within the meaning of the Local Government Act (Northern Ireland) 1972

Social housing

The Housing Corporation

Scottish Homes

The Northern Ireland Housing Executive

A registered social landlord

A housing action trust established under Part 3 of the Housing Act 1988

New towns and development corporations

The Commission for the New Towns

A development corporation established by an order made, or having effect as if made, under the New Towns Act 1981

A development corporation established by an order made, or having effect as if made, under the New Towns (Scotland) Act 1968

A new town commission established under Section 7 of the New Towns Act (Northern Ireland) 1965

An urban development corporation established by an order made under Section 135 of the Local Government, Planning and Land Act 1980

The Welsh Development Agency

Police

A police authority within the meaning of Section 101(1) of the Police Act 1996

A police authority within the meaning of Section 2(1) or 19(9)(b) of the Police (Scotland) Act 1967

The Northern Ireland Policing Board

Miscellaneous

An Education and Libraries Board within the meaning of the Education and Libraries (Northern Ireland) Order 1986

The United Kingdom Atomic Energy Authority

Any person mentioned in paragraphs (g), (k), (l) or (n) of Section 61(11) of the Housing (Scotland) Act 1987

A body prescribed for the purposes of the section by Treasury order
  • the sale of a dwelling (or the grant of a lease of a dwelling) in pursuance of the preserved right to buy. A sale (or grant) is made in pursuance of a preserved right to buy if

 

  • the vendor is

    • in England and Wales, a person against whom the right to buy under Part 5 of the Housing Act 1985 is exercisable by virtue of section 171A of that Act
    • in Scotland, a person against whom the right to buy under section 61 of the Housing (Scotland) Act 1987 is exercisable by virtue of section 81A of that Act (which allows for the preservation of the right to buy on disposal of the dwelling to a private sector landlord)

 

  • the purchaser is the qualifying person for the purposes of the preserved right to buy
  • the dwelling is the qualifying dwelling in relation to that purchaser

 

In the case of a right to buy transaction

  • FA03/S51(1) (contingent consideration) does not apply
  • chargeable consideration does not include any consideration payable if a contingency were to occur or that is payable because a contingency has occurred

 

This means that consideration does not include any contingent consideration which would normally be included in the calculation of chargeable consideration.

 

In a right to buy transaction, where the vendor is a registered social landlord, any purchase grants in respect of the disposal at a discount by the registered social landlord are not included in the calculation of the chargeable consideration.