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HMRC internal manual

Stamp Duty Land Tax Manual

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HM Revenue & Customs
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Special provisions relating to partnerships: Application of exemptions and reliefs

A B C and D are equal partners in a partnership.

A wishes to retire and agrees to take a residential property in settlement.

The property is in a disadvantaged area and has a market value of £160,000.

We are looking at a transfer from a partnership so we need to establish any SDLT liability using para18 and 20 - see SDLTM33750

Step One

Identify the relevant owner or owners.

D is a relevant owner because, immediately after the transaction, he is entitled to a proportion of the chargeable interest and immediately before the transaction he was a partner.

Step Two

For each relevant owner, identify the corresponding partner or partners.

D is his own corresponding partner because, immediately before the transaction he was a partner and he is the relevant owner.

Assuming A B and C are not connected to D there are no other corresponding partners.

Step Three

D is entitled to 100% of the chargeable interest immediately after the transaction.

As there is only one corresponding partner, this proportion is all apportioned to D.

Step Four

The lower proportion for each person who is a corresponding partner (here D) is the proportion of the chargeable interest attributable to the partner, or if lower, the partnership share attributable to the partner.

In this case the figures are 100% (the proportion of the chargeable interest attributable to the partner) and 25% (the partnership share attributable to the partner) respectively, so the lower proportion is 25.

Step Five

We just have one lower proportion, so there is nothing to add together. As a result, the sum of the lower proportions in this instance is 25.

Chargeable consideration is MV x (100 - SLP)%

In this instance £160,000 x (100 - 25)% = £120,000

As this is below £150,000 disadvantaged area relief can apply.