SDLTM34490 - Application of exemptions and reliefs: Group Relief

In general, only an individual can be a corresponding partner to a relevant owner in Step Two of the calculation of the sum of the lower proportions - see SDLTM33550. However, this general rule is subject to two exceptions, provided by Para 12(3) and Para 27A. An example of the application of para 27A can be found at SDLTM34365, SDLTM34390, SDLTM34430 and SDLTM34470.

When calculating the sum of the lower proportions to a transaction in accordance with para 12, the provisions of para 27A apply where a company is connected to, and part of the same group as, a relevant owner (para 27A(1).

In applying para 27A, the charge calculated under paragraph 12 is reduced to the amount that would have been payable had the connected company been a corresponding partner of a relevant owner when calculating the sum of the lower proportions (para 27A(2).

Para 27A(3) provides a modified form of group relief to the reduced charge as per para 27A(2). Where para 27A applies, a partnership will need to make a claim for group relief in a land transaction return in respect of the reduction in charge. When claiming group relief, code “12” should be used in the land transaction return.

The group relief provisions in Part 1 of Schedule 7 are modified by para 27A(3) in respect of the reduced charge.

Furthermore, where a claim for group relief is made in respect of the reduced charge, the usual group relief conditions (Sch7/para2) will need to be met.